Our corporation has owned a leasehold aircraft hangar for several years now which is rented out. We are depreciating it, straight-line, for the life of the lease (30 years originally, 22 years left). The leaseholder (a city) is proposing to modify the lease provisions, including an extension in life for another 40 years. How do we depreciate after the extension? Instead of depreciating over 22 years, we'll now be doing it over 40 years, right? Will we have to appraise it to establish a new basis, or can we just use the remaining depriciation amount (22/30 * purchase price, approx) as the new basis?? Thanks in advance for any help...
- posted
18 years ago