Separate house from land for taxes

[Mark Forest]

I am sure this topic has been in here many times, but when I searched I did not use the right words because I could not find any references.

What method is best used to separate the cost of the house from the land for tax purposes? Thank you in advance for any help.

[Richard Sanderson]

Steve:

In my own experience as a real estate assessor (one was as the City Assessor for Midland, MI) I know that the IRS generally accepts the percentage contribution that land makes of the total assessed value as a basis for land as a non-depreciating asset. For example, if the assessed value for the subject property in the year you purchased it was $100,000 and the assessment for land was $20,000, or 20%, if you allocated 20% of the purchase price of your real estate purchase to land the IRS would probably accept that as reasonable.