Author Topic: Rental tax questions (foundation repairs, moving back in, depreciation recapture  (Read 1321 times)

Bearded Man

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-These are hypothetical, none of my properties have foundation issues, however; I recently discovered that apparently if a house has foundation issues, the repair on a rental is tax deductible. Is that the full amount or just the amount x your tax rate?

-So let's say your primary residence needs foundation repairs. What's to say you move out and turn it into a rental, which you planned to do anyway. Is that a legit way to benefit from the deductions available on rentals, when your house needs foundation repairs.

-When you move back into a rental, you don't have to pay depreciation recapture right? You just can no longer deduct depreciation on your taxes anymore, correct?

salmp01

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If you converted your primary residence to a rental and fixed a foundation issue I believe that this would be tax deductible.   

It is my understanding that if you move back into a rental, live there 2 out of 5 years and sell it that youd need to pay taxes on the recapture of depreciation during the time you rented it.

Im not an accountant and Im sure any accountant that is familiar with rentals should be able to quickly answer these questions so please verify!

Bearded Man

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Yeah I'm familiar with the 2/5 year rule, though I would not be selling unless doing a 10-31 exchange.