I have a house used for rental purposes. It's value is 79,000 less 10,000 for the land value to equal 69,000 residential value. I entered the asset as residential property in QB at only 21% of it's purchase price back in 2019 (69,000x21%=14,490). I was renting only 21% of the house that year. Not sure if that's how I should have valued it on the books at that time of not.
I did enter the total 69,000 value in my tax program. I stated I used it 21% for business purposes so the tax program was taking 21% of the 69,000 to arrive at a Depreciation basis 14,490. All of this seemed correct at the time.
1. Should I have entered a different value of the asset on the books in QB other than the 14,490? That was my business use of the house at the 2019 date.
2. For 2022 my business use changed to 40%. I can easily make this change in the tax program so it will calculate the depreciation rate (40%) correctly. But, don't I also need to record the increased value of the Business use of the house in QB? I'm thinking I should increase the value of the asset in QB to 40% of the 69,000 (from 21% x 69,000 to 40% x 69,000) or from 14,490 to 27,600, right?
3. Can you help me?
