Deductions & credits

Depreciation carried forward represents the amount of deduction you claimed in prior years that could not be claimed because it created a net operating loss. You will have additional depreciation for several years after you first place the vehicle into service for your business. 

However, you may not be able to claim all the depreciation that's applied to your vehicle. In this case, you will have a carry forward each year until you can.

Here are the percentages for a five-year asset using the half-year convention:

Yr 1 = 20.00%

Yr 2 = 32.00%

Yr 3 = 19.20%

Yr 4 = 11.52%

Yr 5 = 11.52%

Yr 6 = 5.76%

Because you took special depreciation, the remaining balance is used to calculate your regular depreciation expense. If you look at the Depreciation Report that is included in your TurboTax return, you can track the depreciation that has been applied to your vehicle each year. 

The screenshot below shows a truck purchased for $60,000 with special depreciation in the first year, a reduced depreciable basis, and 19.2% depreciation for the current year (final column). Total deprecation would be special plus prior plus current = $38,243.