On February 11, 2012, Bill inherits his fathers summer home. The house has a fair market value
Question:
On February 11, 2012, Bill inherits his father’s summer home. The house has a fair market value of $496,000 at the date of his father’s death.
His parents had purchased the house in 1974 for $127,000 and made $59,000 worth of capital improvements to it. Twenty percent of the total value of the property is attributable to the land. Because Bill and Joyce ultimately would like to use the property as a vacation home, they decide to rent it out. Bill actively participates in the management of the property. The property is first advertised for rent on March 1, 2012, but is not rented until April 15, 2012. Bill provides the following income and expense information for the Lake Tahoe rental property:
Rent $18,000
Repairs 4,720
Management fee 2,750
Property taxes 9,375
Insurance 1,900
In addition, Bill buys a new stove for $1,240 and a new refrigerator for $970 on March 20, 2012.
What is the depreciation value and where does these amount goes in forms and schedule
Concepts in Federal Taxation
ISBN: 9780324379556
19th Edition
Authors: Kevin E. Murphy, Mark Higgins, Tonya K. Flesher