Inherited foreign property

tabasit

I inherited a house overseas from my father. The estate is divided between me and my brother and one sister.

The property is owned by me, my brothers, and my sister.

The property is rented, and I need to report income in my taxes.

what kind of a structure is this?

MatthewD

Hi Tabasit,

You must be trying to find the correct depreciable life.  

This could be a residential rental if it is a dwelling, reported on the Schedule E, however as a foreign rental property, you must use the 30 year life for foreign rentals placed into service after 2018. I will explain how you do that.

When you enter the rental address on the Rental on the "Tell us about your rental property" page, make sure you enter the foreign address.  Then proceed to the Depreciable Asset page.

On the "Tell us about your asset" page, answer YES to the quesiton, "Was this asset mostly used outside the United States during 2024?"

Then on the "Which category best describes your <asset description>" select Real Estate. Then on the "Which type best describes your <asset description>" page, select Residential rental property.  You will need a land value.  Then you are finished. The software will make sure the correct depreciation convention is used for the foreign asset.

Keep in mind the basis, is 1/3 the fair market value for your share of the inheritance.