If you don’t own a rental property, this may not interest you. If you do, read on.
One of the rules of rental property is that you must take depreciation each year. To be clear, whether or not you “take” the depreciation on your Schedule E each year you must recapture all the required depreciation regardless. Until now, many who did not understand this wound up going back to their returns and amending them for the last three years, but losing the benefit of all the deprecation not taken.
I recently came across an article titled Allowed or Allowable which discusses new revelations that may help you recoup the money you’d have otherwise lost. The article suggests a change in accounting method, and IRS bulletin 2004-3 confirms the content of the article I cited.
As I stated in my introduction, this impacts few people, but those impacted have the chance to save quite a bit of money by reading the above.
Joe