Tax, SDIRAs & Cost Segregation
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback
Updated almost 11 years ago, 02/18/2014
Partially inherited house - bought out siblings - can i expense repairs
back story - my two siblings and I inherited a house in January 2013. In August 2013 the Tenant moved out (they had been asking to be released early from their lease due to issues with the property). All the rent went into the Trust that my sister was executor for. The garage (same property) remained rented continuously to present. I started painting, repairing, replacing worn out fixtures etc... with my own funds. I discovered long term undetected plumbing, foundation, and window leaks (all of them, an installation issue from 25 years ago). The estate attorney assisted me in buying out my siblings interest, had the property taken out of the trust and put in my name, and I took out a 250k (cash out refi) mortgage out on the property, paid my sibling 208k GIFT and ended up putting 30k more into the repairs. I had a FOR RENT sign on the front fence during all of the repairs in hopes that a passer by or neighbor would be interested. I just kept on working until the tenants I eventually found moved in on january 15th 2014. So..... as it started as a simple Rental Turnover job, then morphed after the real damage began to reveal itself, then I bought my siblings out and took out the loan, and the repairs mounted and culminated in a new kitchen, flooring, lighting, appliances (the old were un-rentable/repairable) is it possible for me to treat some of the expenditures as repairs, maintenance, and 5 - 7 and 15 year depreciation on certain items, and just add the 27.5 year items to the cost basis. Is it possible to treat the job more as a tenant turn over rather than pre-rental expenses in light that the garage remained rented and the work was 90% due to damage from the moisture. Initially I was budgeting for about 10k in repairs until the discoveries kept coming. Any advice please. Thanks Joe