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Mark D
Mark D, Enrolled Agent
Category: Tax
Satisfied Customers: 1250
Experience:  MBA, EA, Specializing in Business and Individual Tax Returns and Issues
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I have been file a rental property under K-1 last 7 years

Customer Question

I have been file a rental property under K-1 for the last 7 years under partnership with my friend. on Jan. 2015 I purchased out his share and I own 100% of the property. I like to know, do I need to start fresh with the same rental property and treated as a new purchase? new cost basis, new depreciation and new market value price as of Jan. 2015? Or should I continue to use the same depreciation and cost basis the K-1 previously years and transfer to as an individual return.
Submitted: 9 months ago.
Category: Tax
Expert:  Mark D replied 9 months ago.

Hello, you would continue with your adjusted basis, but then add a step up in value for the actual cost you paid for his half (as a separate asset). Does this answer your question?

Customer: replied 9 months ago.
can I start fresh with the new adjusted basis? treat it as a new purchase property as of first 2015?
Expert:  Mark D replied 9 months ago.

No, you will keep your original cost basis and accumulated depreciation for the 50% you owned before the new purchase.

Expert:  Mark D replied 9 months ago.

Hello, did that answer your question? Please rate if so. That is how I am paid.