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Wallstreet Esq.
Wallstreet Esq., Tax Attorney
Category: Tax
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Experience:  10 years experience
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How do I report depreciation apartment's vacant years from

Customer Question

How do I report depreciation for an apartment's vacant years from 2011-2014 but which was rented prior to 2011 and has been rented currently from July 2015?
Submitted: 1 year ago.
Category: Tax
Expert:  Tax-Scholar replied 1 year ago.

Hello and welcome to Just Answers. Do you mind sharing more information? Why was the property vacant from 2011-2014? Was the property under construction or available for lease? In order to claim depreciation the property has to be in service. This requries that it is available and ready for use even if no tenant has moved in.

Customer: replied 1 year ago.
The property was in prime condition and available for lease during the entire 4 year period. No renters were available.
Customer: replied 1 year ago.
03 March 2016 03:46
The property was in prime condition and available for lease during the entire 4 year period. No renters were available.
Expert:  Tax-Scholar replied 1 year ago.

Since the property is available for use you are entitled to depreciation and other holding costs. These should be reported on IRS Form 8825 and attached to your tax return. Other deductible cost would include real estate taxes, insurance, interest, etc. Other tax rules could however limit the deduction you are able to claim such as the passive activity loss rules.