tax advise, duplex, schedule E and 4562..

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1

I posted this in a real estate investors forum, but thought I would post in here to get some results as well. No, I don’t need anyone to do my taxes. My situation is not too complicated…

Hey Guys,
I’m pretty well versed with doing my own taxes, using turbotax or whatever… I have the 2008 home and business edition here.
This year I bought my first house, a duplex. I live in the lower, and the upper is rented.
Can someone walk me though what to do with the taxes?
I’m claiming half of the mortgage interest on the schedule A, half on the schedule E. Same with the taxes, and PMI.
I write off half of the water bill.
I put about 5 grand into the house. I have every single receipt for that 5 grand.
Most items were buying supplies to repair the house myself. Paint, little tools, gutters…
Do I claim these items under “supplies” or “repair”…
I bought about 1900 dollars in new appliances for the rental unit. I am on the page where I depreciate the items. Can I just lump the 5 appliances together, and call them “appliances” for 1900 dollars, or do I need to do them one piece at a time…
Example Stove for 350 dollars or whatever, then depreciate that over 5 years…
My final and most important question…
I understand that I can depreciate the rental unit. Would I put the purchase price for the rental unit to be exactly half of what I paid for the house?
I’m pretty confident I can get the taxes done myself, its just the depreciation that is stumping me for right now…
As it turns out, I’m going to be claiming a loss of about 1200 dollars for this year on the unit. This was because I only got 5 months of rent out of it, and we totally refurbished the entire place.
THANKS.
Justin

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Short answer version since I still at work (public accountant).

Break out the two by sq. footage for taxes and depreciation. It really won’t matter if you lump the items together for depreciation although I would break them out as it doesn’t take long and will be easier down the line if you dispose of one in the batch.

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Thanks.

I just thought it was weird to have ten different items depreciating over 5 years.

1 washer for 349 dollars or whatever, 1 dryer…

So the purchase price of the rental on the form 4562 would be half of the purchase price of the actual house, since it is a duplex and I live in the lower. That gets a larger depreciation cycle, I forget what it is 27 years or something (turbotax knows)…

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For your first year, I’d highly recommend going to a professional. I can send you the information for the guy I used when I was doing a bunch of consulting. He came HIGHLY recommended and I’ll HIGHLY recommend him as well. It cost me a little over $100 to have mine and my wife’s done (file jointly) as well as my business. The tips he gave me on where my deductions were short and needed to be “expanded upon” saved me far more than I paid him to do them. And that’s the #1 reason to have your taxes professionally done by someone willing to advise you on that gray area. They know the amounts that trigger audit flags and can let you know if some of your deductions can be increased without fear of tripping an audit flag.

Next year you’ll know most of the stuff yourself and can probably tackle it on your own. PM me if you want his contact info.

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Short answer: It is not advise, it is advice you fucking moron.

God I hate that.