First rental income...Need help

[NewbieT]

Hello all,

This year is my first year collecting rental income. It is a townhouse, occupied 100% by my tenant. As I am filing rental income and learning the rope with CCA, a few questions popped up:

1. If I can only write off depreciation for the townhouse itself and not the land, where do I find the value of the building and the land? MPAC assessment doesn't provide it.

2. The townhouse came with kitchen appliances, AC and furnace, and of course the builders don't tell how much they cost. What is the reasonable original cost of these things?

3. I lived at the townhouse for 2 years before my tenant moved in early of 2022. Do I depreciate the house and appliances for those 2 years I lived in?

TIA

[Geo123]

Hello NewbieT,

1. If I can only write off depreciation for the townhouse itself and not the land, where do I find the value of the building and the land? MPAC assessment doesn't provide it.

You can have a professional appraisal done or consult with an accountant to determine the value.

2. The townhouse came with kitchen appliances, AC and furnace, and of course the builders don't tell how much they cost. What is the reasonable original cost of these things?

You can estimate from the current fair market value of the appliances.

3. I lived at the townhouse for 2 years before my tenant moved in early of 2022. Do I depreciate the house and appliances for those 2 years I lived in?

No

[BLSM]

I don't know where you live, but I'm in BC.  The BC Assessment website gives a breakdown of the assessed value of both land and buildings.  If you can find those numbers anywhere, you could use the same percentage to decide the split.