If you purchase a residential rental property for $250,000 that includes a building worth $100,000, how much will you be able to deduct per year from your rental income if the IRS allows you to spread the cost of your initial investment over 27.5 years?

Question

Quizplus · Accepted Answer

The correct answer is A. $3,636. The IRS allows you to deduct the cost of your initial investment over 27.5 years, so you can deduct $100,000 / 27.5 = $3,636 per year from your rental income.

If You Purchase a Residential Rental Property for $250,000 That