mkedikian
Level 1
12-07-2019
01:28 AM
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Client is converting garage into a guest house and maybe will turn it into rental property. spent already about $50K in 2018. project not completed. no income yet. how and where do i account the $50K expense?
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TaxGuyBill
Level 15
12-07-2019
01:28 AM
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Nowhere.
If and when it is used for a rental, then that will be added to the Basis for depreciation. Until then, the amount spent on it does not go on a tax return (it is possible the interest on any loans may be deductible, depending on the circumstances).
