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The Money Mustache Community
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Taxes for Primary residence temporarily being rented
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Topic: Taxes for Primary residence temporarily being rented (Read 891 times)
nawhite
Handlebar Stache
Posts: 1081
Location: Golden, CO
Taxes for Primary residence temporarily being rented
«
on:
March 04, 2017, 04:14:04 PM »
I own a house. I lived in it for 3 years. While I have owned it, it has appreciated about $100k. We started renting it this year and probably will for another year.
So now I'm doing my taxes and as far as I know I have two options.
1. Don't depreciate the property on my taxes this year and then likely sell next year or the year after while it still counts as a primary residence (lived in for 2 of the last 5 years) and thus not pay the capital gains taxes.
2. Take depreciation now and then don't benefit from the primary residence benefit ever.
As far as I can tell I can't both use depreciation for 2-3 years and get the primary residence benefit when we sell but I would love to be proven wrong.
Anybody have any experience with renting a primary residence for a couple years before selling?
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bacchi
Walrus Stache
Posts: 7095
Re: Taxes for Primary residence temporarily being rented
«
Reply #1 on:
March 04, 2017, 07:57:53 PM »
If you have a rental, the IRS will assume that you depreciate it. You can't choose to not depreciate. Well, you can, but it gives you no benefit.
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Taxes for Primary residence temporarily being rented