Turbo Tax has a glitch relating to Special Depreciation that incorrectly calculates depreciation that needs to be fixed ASAP.
Properties used for rentals require depreciation, including certain items, such as appliances. There is a Special Depreciation (SDA) permitted that will accelerate depreciation and can only be used during the first year that item was placed into service. The SDA is being phased out and in 2023 it was 80%. We took the 80% SDA last year and the remaining 20% was placed into a regular 5-year MACRS depreciation. Our depreciation for the remaining 20% MACRS was $443, meaning we should have depreciation of $443 this year, and the next three years.
Under "Confirming Your Prior Depreciation" one is asked to enter total depreciation for previous years but states "(excluding any Section 179 deduction or first-year special depreciation allowance)." If one clicks on that page "Where can I find Prior Depreciation?", it states "Do not include any Section 179 or Special Depreciation Allowance (SDA) here. If your asset qualified for one or both of them in the first year you used it, we will ask you for those amounts next."
Unfortunately, Turbo Tax only asks for previous Section 179 depreciation BUT NEVER ASKS FOR PREVIOUS SPECIAL DEPRECIATIONS. As a consequence, Turbo Tax figures our Depreciation this year as $4,250, which is way off (it should be $443).
Other people are complaining about this exact same issue but Turbo Tax is not fixing the problem. There are only two weeks left until April 15th.
