# US Return: Depreciation



## debbie790 (Dec 28, 2010)

Hi,

I purchased a new property in 2009 for US$300K. This was my primary residence till May31/2011. From June01/2011 its been rented out. On June01/2011 the market value of the property was US$350K.

1. Should the depreciation be on 300 or 350?

2. For how many years should the depreciation be spread over?

Thanks
Debbie


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## Bevdeforges (Nov 16, 2007)

Everything you ever wanted to know about depreciation direct from the IRS: Publication 527 (2013), Residential Rental Property

1. The depreciation should be based on the "adjusted basis" of the property as described in the publication in the link. What this means is that you start with the actual price you paid (i.e. the 300K) and then adjust for certain additions or other adjustments as described.

2. Check the article, but generally residential property goes for something in the vicinity of 20 years or so. (I skimmed the article, but didn't read it closely. There are a couple of sections that deal specifically with residential property.)
Cheers,
Bev


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## debbie790 (Dec 28, 2010)

Hi,

I have approached three (3) CPAs and they all had different answers. Can someone please help with my questions.

Thanks


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## Bevdeforges (Nov 16, 2007)

When dealing with US tax law, there usually is no single definitive answer. You always have alternatives, interpretations and the circumstances of the particular situation.

The IRS recommends you take a look at their Publication 527, available free online, for help in answering your question.
Cheers,
Bev


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