BACKGROUND: I have two businesses where I use my computer and cell phone for each (40% Biz A, 40% Biz B, and 20% personal). Biz A is single-member LLC (i.e. sole proprietor for tax purposes) and Biz B is a Multimember LLC. So I add my Biz A expenses directly into the Business Section of turbo tax (Home and Business Edition) and for Biz B I enter my asset expense into the Personal Income > K-1 Section.
PROBLEM STATMENT: When I try and enter the asset utilization this way (40% Biz A, 40% Biz B, and 20% personal), TT gives me much less of a deduction than if I had allocated 80% Biz A, 0% Biz B, and 20% personal. Also, I get a message stating that I may be required to recapture the previous year's depreciation since I received special depreciation in previous year.
So what am I doing wrong here? Is there a way to allocate the asset as 40% Biz A, 40% Biz B, and 20% personal and still get the fully depreciation deduction and not have to recapture anything? I would think this should be allowed since I'm collectively using the asset for business purposes 80% of the time (more than 50%).
