Determining value of a building vs land for rental depreciation purpose (appraisal, percentage)

[Scott2000]

I bought a HUD repo in 1986 in Oklahoma City, OK. I lived in it for a while and got orders out of state (I was in the service). I began renting it out in 1991 but never claimed depreciation on it over the years.

So I was finally able to sell the house this year and learned I must deduct depreciation whether I took it or not. So, to determine the depreciation I should have taken I need the value of just the house, not the property.

How can I get it? I have the original paperwork from 1986 but there is no appraisal (I guess since it was a repo or I just never got a copy.)

I do know that the annual taxes that year were $346 and I paid $38,000 for the house.

Any suggestions?

[AZJoeD]

Check with the county assessor or treasurer and see if you can get the formula they use for valuing property for tax purposes. Usually they have a formula that amounts to some percentage (20% land, 80% building) or ratio. Then you can figure your tax basis and take the appropriate amounts.

[Scott2000]

Would the county change the formula over time? For example this year the assessed value was 18% land and 82% property.

[oregonwoodsmoke]

Your property tax bill does not arrive with value for land and improvements separately listed?

The tax bill from the year you purchased is the only one you need. Depreciation is based upon the purchase price and doesn't change every year. Tax collector might be able to look it up for you.

[Scott2000]

Thank you.

[KonaKat]

A CPA also can help you probably.

And remember, land never depreciates; only improvements on it. (Unless it's contaminated or something!)

[jackmichigan]

Originally Posted by KonaKat

And remember, land never depreciates; only improvements on it.

Well, land can certainly depreciate in value--but you can't claim depreciation for tax purposes.