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Posted by Ray on April 9, 2007, 3:29 am
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My daughter got married in 2006 and began renting her
previous house in November.
I reported this rental income on Schedule E. I chose not to
report depreciation on the ground that we would have to
report recapture when she sells the house, probably within a
year or two.
But I ran across something in TurboTax which told me that
depreciation is REQUIRED by the IRS.
This doesn't make sense -- but then, a lot in the tax law
doesn't make sense.
Advice, please.
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<< that may be imposed upon the taxpayer. >>
<< >>
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Posted by parrisbraeside@yahoo.ca on April 10, 2007, 10:06 am
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Ray wrote:
> My daughter got married in 2006 and began renting her
> previous house in November.
>
> I reported this rental income on Schedule E. I chose not to
> report depreciation on the ground that we would have to
> report recapture when she sells the house, probably within a
> year or two.
>
> But I ran across something in TurboTax which told me that
> depreciation is REQUIRED by the IRS.
>
> This doesn't make sense -- but then, a lot in the tax law
> doesn't make sense.
>
> Advice, please.
Recapture in the US is incurred on depreciation allowed or
allowable, whether or not it was taken. You are thinking of
Canadian recapture.
You would be better off amending last year's return.
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by Paul Thomas, CPA on April 10, 2007, 10:06 am
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> My daughter got married in 2006 and began renting her
> previous house in November.
>
> I reported this rental income on Schedule E. I chose not to
> report depreciation on the ground that we would have to
> report recapture when she sells the house, probably within a
> year or two.
>
> But I ran across something in TurboTax which told me that
> depreciation is REQUIRED by the IRS.
>
> This doesn't make sense -- but then, a lot in the tax law
> doesn't make sense.
You'll still compute the gain on the sale based on the
depreciation you *should* have taken - so take it.
This may mean you have to file amended returns to claim the
depreciation.
--
Paul Thomas, CPA
paulthomascpapc@bellsouth.net
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by Phil Marti on April 10, 2007, 10:06 am
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> My daughter got married in 2006 and began renting her
> previous house in November.
>
> I reported this rental income on Schedule E. I chose not to
> report depreciation on the ground that we would have to
> report recapture when she sells the house, probably within a
> year or two.
And when she does you'll learn that the recapture applies to
depreciation allowed OR allowable. IOW, she'll be taxed on
the depreciation whether she claims it or not.
You need to amend.
--
Phil Marti
Clarksburg, MD
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by LoTax on April 10, 2007, 10:06 am
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> My daughter got married in 2006 and began renting her
> previous house in November.
>
> I reported this rental income on Schedule E. I chose not to
> report depreciation on the ground that we would have to
> report recapture when she sells the house, probably within a
> year or two.
>
> But I ran across something in TurboTax which told me that
> depreciation is REQUIRED by the IRS.
>
> This doesn't make sense -- but then, a lot in the tax law
> doesn't make sense.
>
> Advice, please.
Claim the depreciation.
Don't be lazy.
If you don't, you'll kick yourself.
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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