Rental depreciation depends on the property's depreciable basis and when it is placed in service. Land is not depreciable, so the total purchase price is not automatically the amount used for the building's depreciation.

The closing statement, allocation between land and building, acquisition costs, improvements, and prior use can affect the calculation. Property converted from personal use requires additional basis analysis.

Keep records showing when the property became ready and available for rent, not just the date a tenant moved in. Preserve depreciation schedules from every prior return so a future sale or change of preparer does not require guessing the accumulated depreciation.

Your next steps

• Save closing documents and basis allocations.
• Document when the property became available for rent.
• Retain improvement and depreciation schedules.

General education, not individualized tax or legal advice. Illustrations use stated assumptions and do not promise a refund or tax saving.