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Old 09-30-2010, 09:59 PM
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Join Date: Sep 2010
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Depreciation of apartment property I didn't live in

Hello,
Thanks in advance for your advice.
For 6 years, I've owned the apartment I just moved into in August 2010. My nephew lived there the last 3 years. He didn't pay me rent. Can I depreciate this property for the lenght my nephew lived there? I paid 186k for the property and have been paying maintenance fees all this time.

Regards,


Alex



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Old 10-30-2010, 12:27 PM
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Join Date: Oct 2010
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" Can I depreciate this property for the lenght my nephew lived there? "----> Of course.You recover the cost of income producing property through yearly tax deductions. You do this by depreciating the property; that is, by deducting some of the cost each year on your tax return.
You can depreciate your apartment building over 27.5 years on a straight-line basis. Assume that you purchased the apartment on march 3rd of 2005 for $186,000, then in the first year your annula accumulated depreciation expenses is $186,000/27.5*10/12=$5,636.Your annual accumulated depreciaiton expanse is $186,000/27.5=$6,764 in the second year.



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