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Posted by R. Pile on March 30, 2007, 3:37 am
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This question involves a rental property purchased by
brother and sister in 1981. Brother filed MFJ with his
wife, claiming his half of depreciation expenses; sister
filed her own tax return, claimimg her half of depreciation
expenses. Sister died in 1995 when house was re-appraised.
Brother inherited her half of rental property and a
stepped-up basis. Brother sold house in 2006.
1. Normally, for the capital gains computation, the basis is
reduced by depreciation "allowed or allowable." Now that
the house has been sold, does brother reduce the basis by
the total amount of depreciation claimed by both he and his
sister separately or just the amount of depreciation claimed
on his own tax returns from 1981-1995?
2. Does inheriting the sister's half of the house constitute
the aquisition of a new asset and a new depreciation
schedule (at 27.5 years) for that property starting in 1995?
3. Without any other information, I am assuming the
depreciable (house) portion of the property is two-thirds of
the total, with the undepreciable land being the remaining
one-third. Is that a reasonable estimate?
4. In 1981, was this 15 year real property ACRS
depreciation?
Thank you.
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