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Posted by removeps-groups@yahoo.com on April 8, 2008, 12:57 pm
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On Apr 7, 1:18 pm, ampar...@gmail.com wrote:
> I have a certain loss on my Schedule E. I have rental for the last 4
> months of 2007..this was my primary home before that.
>
> 1> I have used mortgage + prop tax( both 4 months pro-rated) + HOA ( 4
> months) + expenses( painting et al) + appliance upgrade + depreciation
> as total expenses which gets me to a loss....is this the correct way
> to do it ?
Mostly. I think that appliance upgrade may be a capital improvement,
so not deductible but added to the cost basis (and would need to be
depreciated as well). Note that the mortgage interest and property
tax for the 4 months goes on Schedule E, and property tax and mortgage
interest for 8 months goes on Schedule A. Make sure that you
depreciated the house only (not land), and wrote the date first put
into use as Sep (so your depreciation is 1/4 the full year amount).
> 2>Does AMT make any difference or to put it better...are all the
> expenses listed above considered under AMT ( or there is something
> that needs to be adjusted)
Yes, all the amounts above are before AMT. A nice deal. Your
property tax on Schedule A is subject to AMT, and your mortgage
interest and property tax on Schedule A are subject to the phaseout.
But on Schedule E you're safe.
Be aware that you'll have to pay 25% on the dpreciation when you
eventually sell your house, no exclusion.
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