Do I include the down payment I made on a rental property in the basis for depreciation?
Yes. The down payment is a payment toward the total cost of the property. Your basis in the property is this total cost plus or minus certain adjustments.
Land isn’t depreciable, so you must allocate the cost of the property between the land and the building.
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This advice is for general information purposes only and may not apply to you. Every tax situation is different. This is not intended to be legal advice. Taxpayers should consult an H&R Block Tax Professional regarding their individual tax situation.