Rental Property

[Florida_EA]

Client has rental property that was reported on the Schedule E and Form 1040. Now the client moves the property to a partnership. Does the partnership continue depreciating the property as the partners (HW) had been depreciating before on the 1040?

[kathyc2]

Client has rental property that was reported on the Schedule E and Form 1040. Now the client moves the property to a partnership. Does the partnership continue depreciating the property as the partners (HW) had been depreciating before on the 1040?

Yes, as long as it's only shifting from E to 1065 and not due to change of ownership.

[ATSMAN]

Yes, as long as it's only shifting from E to 1065 and not due to change of ownership.

Be careful about rental property with a mortgage transferred from individual ownership to a partnership. The partners basis is generally reduced by the liability of the mortgage! There are other issues as well that may cause the partner to realize a gain when property with a liability is transferred in to the partnership.