I have a business asset that I've been depreciating with TurboTax since 2017. Every year, the amount of depreciation TurboTax calculates has been exactly what I expected... until now. Here are the details TurboTax has in the forms view (form 4562):
- Asset in-service date: 7/27/17
- Cost 16,148
- 100% business use
- Depreciable basis 16,148
- Life 7.0
- Method 200DB/HY
For my 2022 taxes, it reports prior deprecation of 12,545 (as expected) but current depreciation of 1,441 (unexpected).
I plugged my parameters into the depreciation calculator here: https://www.calculatorsoup.com/calculators/financial/depreciation-declining-double.php
And got these results:
Year, Depreciation
2017, $2,307
Every year from 2017 to 2021, TurboTax's calculation has exactly matched this web calculator, but this year, it wants to depreciate $1,441 again instead of the expected $1,029. Any idea why?
Thank you.
P.S. On a related note, saying this asset has a salvage value of zero (i.e. worth nothing after seven years) is incorrect. I'm not sure I was asked to provide a salvage value. Would it be better to continue depreciating it to zero and then report a gain if the day ever comes to sell/dispose of the asset? Or would it be better to somehow 'abort' the depreciation at this point?
