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Financial Planning / Tax Strategies
|Subject: Re: Selling A LLC||Date: 5/30/2013 5:08 PM|
|Author: ptheland||Number: 118649 of 124773|
A complication is that my wife acquired the property with her sister. This wasn't working out so my wife bought out her sister. I think this means there are two bases: 1/2 the property based on my wife's acquisition cost and 1/2 on the price she paid her sister.
Yep. That's correct.
As the acquisition was made 30 yrs ago, I presume (for now) that her share of the structure was depreciated away long ago, but the sister's half probably has something left.
30 years ago was 1983. That's back in ACRS depreciation territory, and the longest life for rental real estate under ACRS was 19 years. (There's some at 15 years, some at 18, and some at 19. I don't remember the exact cutoff dates for each one, but it doesn't really matter as they're all going to be fully depreciated by now.)
MACRS started in 1987, and I would guess your wife bought out her sister some time after then based on your guesses of appreciation since the purchase. That depreciation would be on a 27.5 year life, so there should be some depreciation left.
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