The IRS tax code forbids U.S. Taxpayers from depreciating land. See where this is going?
The U.S. tax code basically says the land is forever, regardless if it’s underwater or not. Of course, the people who wrote the tax code obviously never lived in the State of California on the earthquake fault line.
When preparing taxes, if your property is used for business, this includes your primary home or rental property, you can ONLY depreciate the actual cost of the property minus the value of the land.
When you look at the destruction #Harvery caused, you can appreciate the tax code which allows us to be grateful AND to realize things could have been worst. The land is still in tack. Maybe the building that occupied the land is gone, underwater or demolished, yet, the land is still there. For that, we can be grateful.
I know it’s hard to be grateful after an experience with Mother Nature, on the level of Harvey, but it’s at these times when being grateful will help you to rebuild a more prosperous life.
#Houston, our #prayers, the IRS and the entire country is with you. Be safe and plan on having your #taxes done professionally. Depending on if you owned or rented, or the type of property insurance you have, your 2017 tax return will be very different than previous year tax returns. A professional tax professional will ensure you get every deduction and the largest tax refund possible.