I took depreciation on my rental property in 2015. I wish to stop taking depreciation in 2016 and later years. Can I do this? Do I have to amend my 2015 return?

[donjenkins]

The property is still rented.  Not converted for personal use.

[AmyT · Accepted solution]

You are not required to claim the depreciation expense, and do not have to amend a return on which you have already done so.

Please be aware, however, that even if you do not claim the expense, when you sell the property your gains will be determined base the amount of depreciation allowed or allowable.  This means that you will have to recapture the depreciation (pay tax on it at ordinary tax rates instead of capital gains rates) based on the amount of depreciation you were allowed to take whether you claimed this expense or not.

[andrewstevenh]

I have a rental property that has declined in value (it happens). I have been taking depreciation on it for 15 years and would like to stop taking it starting this year.  What do I have to do in TurboTax to delete the appreciation amount (which was based on the standard 27.5 year time period) without disturbing the prior actual accumulated depreciation? And will I have to do it every year? Thanks.

[DianeW777]

The IRS does not allow anyone to change the recovery period of an asset.  A residential rental property cannot be changed to a period lower than 27.5 years.  You cannot change the cost basis of the rental home.  You must continue to depreciation the property the way it is set up until you remove the property from service or sell it.  

The prior depreciation would be incorrect if you made any changes to the original cost/basis for depreciation. 

@andrewstevenh

[andrewstevenh]

Thanks.