Thank you!!! And the client thanks you!! That is what I thought but at 12:30 am I was beginning to doubt myself!!
Laura M. Morton, EA
10 Key Solutions
Accounting Solutions for the Small Business
770-985-1621
770-985-6618 fax
From: taxchat@yahoogroups.com [mailto:taxchat@yahoogroups.com] On Behalf Of Debbie Wilson
Sent: 09/10/2008 9:38 AM
To: taxchat@yahoogroups.com
Subject: RE: [taxchat] Basis question...
Yes you have to add back the land. I usually put the land on the deprecation schedule so I have the correct basis, I just don’t depreciate it.
Debbie Wilson
From: taxchat@yahoogroups
Sent: Wednesday, September 10, 2008 12:24 AM
To: taxchat@yahoogroups
Subject: [taxchat] Basis question...
Ok…might be stupid question, but right now it is about a $10K question!!
On the basis of residential rental property….
Purchased property - Established true cost of property backed out cost of land and then depreciated the balance accordingly.
Selling property- Established selling price, cost to sell, deducted depreciation taken but….don’t I add back in the value of the land at this point? That is part of the original ‘purchase’ cost, just not depreciated.
I can handle the outcome with the land added back, but not without….there is literally a 10K swing in the tax amount.
Thanks – and I remember that the stupid question is the one that goes unasked….
Laura M. Morton, EA
10 Key Solutions
Accounting Solutions for the Small Business
770-985-1621
770-985-6618 fax
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