Hi,
You are correct in that the amount of previous depreciation calculated by TurboTax was $74,256, and I'll address at the end of this post. But please try this experiment first.
Take a calculator and divide the cost basis of $241,426 and by 27.5. Please confirm that a calculator (i.e. don't use TurboTax for the moment) gives $8.779.12, which we round to $8,779.
Consider a service date of 7/01/2012. This means that, through the end of 2020, I've had 8.5 years of depreciation. Now, on your calculator, please multiply $8,779*8.5. Please confirm that the answer is $74,621.50, which we will round to $74,621.
Now, please consider the TurboTax number of $74,256. Naturally, when I saw that figure, I checked my own records and corrected it to $74,621. After doing do, TT calculated depreciation as $8,760. Head-scratcher. So, after I made my original post, I decided to reset the previous depreciation back to $74,256, and now TurboTax gives me the correct $8,779 for 2021.
I'm a numbers person and a logical person. I don't like internal inconsistency. Why does TurboTax apparently rely on an incorrect previous depreciation number in order to calculate a correct 2021 depreciation figure? If someone could explain *that*, I'd put stock in the answer. A few people have said 'user input'. Thanks. There are two inputs: the cost basis and the service date. We already agree that on 27.5 MM SL. The inputs are correct. The crux is that previous depreciation figure calculated by TT. It appears to be incorrect, but when I correct it, this year's depreciation is incorrect. Also, I've taken that depreciation, so underreporting it is not cool with me. If I was selling the property this year and relied on that previous depreciation figure, I would overstate my ACB and therefore under-report my capital gain.
I have had three CPAs since 2012, one other software package, my Excel sheet, my brain and my calculator. All agree that the previous amount is $74,621+/-, not $74.256. Why is TurboTax coming up with $74,256?
Thank you,
