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Level 2

Missed residential builling depreciation

Hi -


Can I re-capture any depreciation for the rental property that I had missed in the previous return? Apparently, I only listed out the new assets (like appliance, carpet, etc.) that I brought. However, I just noticed that there was no depreciation calculation on my rental property that was started 2001. I assumed the rental property itself would consider it as building/residential and will have 27.5 years of depreciation. Is it correct? and what should I do in 2017 tax return?


1 Comment
Employee TurboTax Specialist

Missed residential builling depreciation

Two things:

  1. First, no you cannot take more depreciation this year because you didn't take it in the past.
  2. Second, the only way to "catch up" depreciation is to file amended returns for every year when you should have claimed depreciation and didn't.

When you set up the Rental Property this year, TurboTax will provide an estimate of the accumulated depreciation that should have been taken over the life the asset to this point. Your best option is to accept the TurboTax estimate, since you have no prior numbers.


Yes, Residential Real Property is depreciated straight-line (the same each year) over 27.5 years. The first and last years are typically half-year amounts, which makes it tricky to do the calculation manually.


Also note that should you decide to go back and take the missing depreciation, you can file amended returns for only the last three tax years. (See this TurboTax post for more info: How to Amend (Change or Correct) a Return You Already Filed)


Finally, should you sell the rental property in the future, you will be required to offset your basis by the accumulated depreciation you should have taken, even if you did not (IRS rule).