nytcpa2012
Level 4
07-12-2023
12:04 PM
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right back atcha....clarification needed:
In researching various sources on this question, I'm getting mixed information. Simplest explanation is that the IRS will consider this to be 2 separate sales.
In that case, the unrented portion and its gain can use the primary residence exclusion, and the accumulated depreciation on the rental portion just reduces basis on that sale.
While that depreciation amount is more than the excluded gain on the primary residence portion of the sale, it wouldn't matter, since those two parts reported separately.
Is that what you're saying? That's the way I've calculated it for now.