First adjust the purchase price of the building by the estimated value of the old roof when the building was put into service. Then adjust the accumulated depreciation of the building by the calculated value (as shown above) for the old roof. Add the new roof as a new asset (improvement).
Example:
Building Purchase Price = $127,000
Accum Depr Building = $4,000
Est Value Old Roof = $27,000
Est Depr Old Roof = $850
Adjusted Basis for Building = $127,000 - $27,000 = $100,000
Adjusted Accum Depr for Building = $4,000 - $850 = $3,150
Note that you will need to use TurboTax for Desktop in order to manually adjust the Asset Worksheet for the building. The boxes to make your adjustments are Line 4 - Total Cost when acquired, Line 10 - Prior Depreciation, and Line 12 - AMT prior depreciation. You may wish to use the option to Add Supporting Details so you can document your changes (right-click on the box). Enter the original number as a positive number then the adjustment as a negative.
Look on the Depreciation Report for the cost and depreciation numbers you'll need for this entry.
@ebluh
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