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Old 01-18-2014, 10:53 PM   #3
THD
Guru
 
City: Seattle
Join Date: Apr 2012
Posts: 1,142
RS-As a tax attorney, I have to give the usual disclaimer that this is not legal advice and should not be taken as such. That said, ESE has it partially right. What you own is indeed the air above and the water below your slip and an undivided interest in the hard assets, i.e. land, docks, buildings etc of the Marina. This is the equivalent of a land condo owner woning an undivided interest in the common areas of a condo complex. I assume there is a Slipowners' Association or something similar, an association that is similar to a Condo Owner's Association. You should be paying monthly or annual Association dues. For IRS purposes, the Association is considered the holder of the common property. It does not depreciate or deduct expenses(primarily real estate tax and land lease costs) in relation to that property. In return, its income, the fees you pay, is not considered taxable income. In short, you have nothing to depreciate. However, your Association fees, assessments and other payment to the Association are deductibe in the period in which you pay them. If you have any other direct expenses with respect to the slip. those are deductible as well. Thus, your net income from the rental is going to be the rent you receive minus the dues you pay.

Hope this helps.
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