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Financial Planning / Tax Strategies
|Subject: Buying the other half of a rental property||Date: 10/5/2012 12:18 PM|
|Author: chrisbridges||Number: 116737 of 121316|
Here’s a real estate question – I hope it’s an interesting one:
We own a rental property with our daughter (she owns 50% and DH and I own the other 50%).
We have owned the property for about 8 years, reporting income, depreciation etc. on Schedule E. We have been evenly splitting the income, expenses, and deductions between ourselves and our daughter.
Now we are going to buy our daughter out. If I understand correctly, she will report the sale of her half and recapture the depreciation etc.
How do we report the acquisition of the other half of the property? Again, if I understand correctly, that half starts depreciating anew, like a new purchase. Do we keep treating each half of the property separately on our tax returns? I use Turbo Tax Premier and I don’t see where or how this kind of a transaction gets addressed.
I could hand it all over to an accountant, but Turbo Tax has been keeping track of the depreciation over the past 8 years and I would like to keep using TT if I can. I expect our finances to be much simpler over the next few years (except for this property) and I think I can do it myself, if I can find how to make TT digest this information.
Thanks for any help or advice – I am an infrequent poster but a great fan of this board and its resident experts.
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