Special Depreciation Allowance

[scapularsales]

I sold a piece of rental property.  When calculating the depreciation recapture for the property will I add the "Special Depreciation Allowance" to the prior and Current depreciation?

[TaxGuyBill · Accepted solution]

Yes.  Use all three of those (and any Section 179) to calculate the total depreciation.

Just to double check, when you say "rental property", so you mean a building that you rent out?  If so, are you referring to appliances or something?  For the most part, the building itself does not qualify for the Special Depreciation Allowance.

[SweetieJean]

"When calculating the depreciation recapture for the property will I..."  Doesn't the program do this automatically?

[scapularsales]

It didn't for me.

[TaxGuyBill]

If you enter the sales price in the "asset" section, the program WILL calculate the appropriate taxes.  If you enter it elsewhere (such as the Sale of Business Property section), you need to manually add up the depreciation.

[ghost]

Seems like the program has a flaw if the result depends on where the sales price is entered.

[TaxGuyBill]

@rebab  The Sale of Business Property section is basically a manual entry section (similar to the stock section), while the Asset section already has all of the pre-existing information, and you just add the sales information.

[ghost]

That's clearer, thanks.