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Old 01-31-2008, 08:11 PM   #141
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1) Do you rent or own? Both.
2) If you own, have you paid off your mortgage?/s Yes.
3) Do you count your home into your net worth equation? Yes.
4) Does your home figure into your financial plans during retirement? I guess yeah, huh? whether we live in it or sell it to help finance retirement.
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Old 02-01-2008, 03:46 AM   #142
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One big caveat....a CAR is a DEPRECIATING asset, and a HOUSE is an APPRECIATING asset.........but in the end I agree...........
Agreed but in reality the land appreciates while the structure depreciates without serious upkeep and updating to current trends. Have taken on enough back breaking rehab projects to atest to this
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Old 02-01-2008, 04:09 AM   #143
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we are assuming real estate will go up over time as it has , otherwise its just like a car. thats why we get a depreciation writeoff on rental real estate , because its assumed to be like any other depreciating asset.

im not saying it will or wont go up other than we got spoiled and saw an asset that should be depreciating as it gets older go up.
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Old 02-01-2008, 07:24 AM   #144
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Agreed but in reality the land appreciates while the structure depreciates without serious upkeep and updating to current trends. Have taken on enough back breaking rehab projects to atest to this
If you own a piece of land and rent it out for RV users do you get to depreciate the land?
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Old 02-01-2008, 08:51 AM   #145
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If you own a piece of land and rent it out for RV users do you get to depreciate the land?
What's the useful life for unimproved land? It's indestructible and permanent, isn't it? So, land can't be depreciated from an accounting standpoint because it doesn't fit any accounting construct for depreciating assets. And some land can depreciate in value if the negative externalities are daunting like ground water contamination if you're supplied by well water. And correspondingly, some other personal assets can appreciate in value over time if held long enough and in good shape such as classic cars or collectibles.

I think the valuation issues as well as financial planning concerns with a house surface around the fact that a house used as a personal residence (i.e. a home) is really a personal asset that we take immense practical pleasure in enjoying. The home has exceptional intrinsic and extrinsic value to an owner. And like most personal assets held for consumption and not for investment, like cars, appliances, furniture, timeshares, etc. most of us don't take them into account for long-term financial planning unless we liquidate, cash-out, or exchange these assets for something else. Yes, technically from an accounting standpoint, cars, furniture, appliances, my autograph Willie Mays' baseball, and the house all should be included on the balance sheet of assets and liabilities -- and lender's insist we include that in loan applications -- but practically speaking, many of us seem to treat the home as something special.
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Old 02-01-2008, 04:14 PM   #146
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What's the useful life for unimproved land? It's indestructible and permanent, isn't it?
Unless it's near an active volcano or close to the San Andreas fault........
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Old 02-02-2008, 12:39 PM   #147
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Unless it's near an active volcano or close to the San Andreas fault........
Hey, people are still living in Royal Gardens (starbulletin.com | News | /2008/01/03/) despite the lack of road access.

They have septic fields, water catchments, solar water heaters, photovoltaics, innovative transportation, and really good evacuation plans... but I don't think that the IRS is giving them a depreciation allowance on their land. Many of them can't even file an insurance claim.
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Old 02-02-2008, 12:43 PM   #148
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but I don't think that the IRS is giving them a depreciation allowance on their land. Many of them can't even file an insurance claim.
They are probably renters....
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