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Financial Planning / Tax Strategies
|Subject: Re: Loss on rental house||Date: 11/26/2012 9:13 AM|
|Author: TMFPMarti||Number: 116975 of 121442|
In WA State, where I am, the County Assessor is required to assess at 100% of full market value each year. It would seem that the IRS would have to go through a LOT of effort to disallow that figure.
Well, that would depend on how accurate the Assessor is. Kansas has the same requirement, and my father always played a game with the neighbors when the new assessed values were published in the paper, and the neighbors would start griping about how overstated the value (used as the starting point for tax assessments) was.
"Would you sell today for that much?"
"Hell, no. It's worth a lot more than that."
Not relevant to the sale process, but relevant to depreciation, is the land/improvements mix since land isn't depreciable. All hell broke loose in Northern Virginia a couple of years ago when many people with so-so houses in great locations found upwards of 75% of the total value allocated to the land.
Appraisal is an art, not a science, and that holds true for elected/appointed public servants as it does for private-sector appraisers. In my experience real estate agents have been the best source for a good idea of what a property will sell for today.
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