Real estate depreciation

[Concepcion D.]

I have a rental property that I would like to purchase but the seller is adding a questionable clause to the purchase agreement.  The seller wants to specify how much the land and the improvements are separately for tax purposes, and assigning a lower value to the house.  My problem is if the house is valued less then there is less to claim for depreciation.  Can a seller make these assumptions in price?

[Michael Plaks]

You can put whatever you want in the purchase agreement, however such an agreement does not override tax laws, neither for you nor for the seller. You will have to set up depreciation based on the real values of what you purchased. His tax shenanigans are his problem.