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Tax, SDIRAs & Cost Segregation

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Rick Jones
  • Pennsburg, PA
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How to classify mixed-use property on Sched. E

Rick Jones
  • Pennsburg, PA
Posted Mar 11 2018, 11:19

I'm wondering how to classify my mixed-use property on schedule E. It has 6 units, 5 residential and 1 commercial and naturally it would be advantageous if I could classify the property as residential and be able to depreciate over 27.5 years vs 39 years. 

By unit count the property 83% residential and 17% commercial, by sq footage the property is 67% Residential and 33% commercial. By income, the property is 62% residential and 38% commercial.

So BP how would you classify this? Any creative ideas like splitting the property into 2 separate properties and depreciating them in that manner? Any suggestions or advice is appreciated!

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