Turbo Tax is applying an Alternative Minimum Tax (AMT) adjustment to your foreign rental property depreciation. This happens because AMT rules often require a different depreciation method than regular tax calculations. Specifically, AMT depreciation tends to use a longer recovery period or a different calculation method, which can result in slight differences in depreciation amounts2.
In your case, the $-19 adjustment suggests that TurboTax is making a minor correction based on AMT rules. This adjustment is not an additional tax but rather a recalibration of depreciation for AMT purposes. The IRS requires taxpayers to calculate both regular tax depreciation and AMT depreciation, and you pay whichever results in a higher tax liability.
If you want to verify or adjust this, you can:
- Check Form 6251 in your return to see how AMT is affecting your tax calculations.
- Review the asset entry in TurboTax to ensure the correct depreciation method is selected.
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