You can depreciate the building and improvements but not the land when you buy a rental property. Because land is not a depreciable asset, you must allocate a portion of the purchase price to its value. This is how you go about determining the allocation.
Watch this video from The Tax Smart Real Estate Investors YouTube channel to learn more.
Listen in to learn:
- Three methods of determining the ratio that you can use to allocate value between improvements and land
Subscribe to the YouTube channel for more answers to real estate tax questions!
Recent Articles
How Hall CPA Works Differently
June 17, 2024Why Real Estate Investors Choose Hall CPA
October 1, 2026









![Walkthrough: How a Short-Term Rental Investment Can Result in BIG Tax Savings [Tax Smart Daily 060]](https://www.therealestatecpa.com/wp-content/uploads/2023/12/img-blog-49.webp)
![How to Claim Tax Losses Even When You Put $0 Into a Deal [Tax Smart Daily 059]](https://www.therealestatecpa.com/wp-content/uploads/2023/12/ts-daily-59.webp)