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Updated about 8 years ago,
depreciation basis in cash out refinance
Question for you CPA's.
Let say you pay $75k cash for a house. You renovate it and a few months later it appraised for $125k. Now you do a cash out refinance at 75% LTV on the $125k. Land is valued at $20k
Can you start your depreciation basis with the $125k-$20k(land)? Or does it have to be the amount you initially paid for?