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Updated over 1 year ago, 03/26/2023
Depreciation on primary home when only renting out a portion as STR for 3 months
I am working with an EA to handle my 2022 taxes. I rented out the upper portion of my primary home as an STR for 3 months in 2022. I would like to write off some improvements made to this area of the home to get it ready for rental as well as my home office. The upper portion of the home is also used by us when its not rented for entertaining. I also have a W2 job but home office is used for rental business and the like.
I am being told by the EA that I will now have to use the depreciation on my primary home since we the upper portion for 3 months and that this will complicate things when I go to sell and pay those taxes back. They are asking questions as to when I bought the home, for how much and cost of remodeling over the past 8 years so she can add it to total value of home. I am worried that it is over complicating the situation and setting us up for further issues in subsequent years should we decide to no longer rent it out as STR. Is this the way the taxes on the 3 months of rental should be handled? Can anyone refer to me a tax pro in Minnesota for future years?
Thank you.