I bought a bread route as my self employed business, is it depreciable? Where should I claim the depreciation?

[jmajirsky]

I bought the rights to a territory to deliver bread.  I've been told it's depreciable.  Where do I enter that information?

[MinhT · Accepted solution]

A bread route is considered as a Section 197 intangible by the IRS. The cost has to be capitalized and amortized over 15 years.

Please read this IRS document for more information:

https://www.irs.gov/businesses/small-businesses-self-employed/intangibles

• In TurboTax Home & Business, under Business Assets, go to the Asset Summary and click Add an Asset
• On the next page, click the radio button next to Intangibles, Other property (see attached screenshot)
• On the next page. choose Amortizable Intangibles and click Continue to enter the details of the asset
• TurboTax will calculate the amortization and include it in your Schedule C.
  

[breadguy]

I did not amortize my bread route the last 2 years, I am interested in doing it i know it is under 197 but what do i do for the last 2 years? do i have to file an amended return? thanks for your help

[GeorgeM777]

Yes, file amended returns for the years in question.  You can amend both years using TurboTax.  If you are using TurboTax Online, 

1. scroll down the page to Your tax returns and documents  
2. click on the drop-down arrow if necessary
3. when you log into your account, scroll down to the bottom of the page where you will see the various tax years during which you filed a tax return through TurboTax. 
4. select year 2020, as that is the year it appears you want to amend,
5.  select "Amend, Change Return" near the bottom right of the Tax Home page, 
6.  after selecting Amend 2020 return, follow the steps to begin the process.

To amend your 2019 return, follow the same process as above.  

Note:  Any changes you make to amend your federal return will automatically be transferred over to your state return. If you’re already amending your federal, you don’t have to make any changes to your state, unless you’re making state-specific changes.

@breadguy