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Investors & landlords
Thank you so much for the reply. One question on the method of adding the stepped up basis amount (1/2 of FMV) to the expenses though... I like that option by the way! But that will take into account the full amount of depreciation. In reality, the spouse should only have to recapture 1/2 of the previous depreciation, right? Plus there is an amount of depreciation that would need to be recaptured from date of death until date of sale on the new basis. Hence why I think you need the new basis added in the first place in the asset summary. So really my question comes down to how to report the sale for both the old asset up until date of death and new asset from DoD to time of sale. The date of death was in 2017, so the old asset just sits there in the asset summary and has no depreciation being taken out anymore. The new asset starts from DoD and goes until sale date and has depreciation associated with it.
From what i see in Turbo Tax, you cannot take something out of service for personal use without saying it was sold... seems to be a flaw.
Still baffled on how to do this the correct way in Turbo Tax and now there is another option or method to consider. But if you can explain how it knows how to correctly take out the right depreciation, I'd be inclined to go that route.