Hello. In our 2020 return, we took Section 179, 100%, for two assets, for the total amount of $816. However, because the rental property had a loss, the deduction was disallowed and and on Form 4562, indicated to be carried over to 2021's return. On our 2020 Form 4562 for Depreciation & Amortization, Line 13, the correct total amount of of $816 was shown to be carried over to 2021.
We imported our 2020 return into our 2021 return, and on the 2021 Carryover Worksheet, on Line 24 of the "Other Carryovers" section, in the column for 2020, the $816 was correctly displayed. So all looked good, except that ...
Turbo Tax highlighted the field in pink, indicating an error, and in the Forms View, the Carryover Worksheet had the red exclamation point next to it, indicating an error. When I ran the Fed Review, the Carryover Worksheet Line 24, column 2020, was flagged as an error that needed to be fixed.
In the Forms View, the "about Line 24 1st col" said that the amount here must be equal to the amount in the activity that generated it and be entered on the activity that originally generated the deduction. How do I do this? I tried the following using the Forms View:
- went to the Schedule E Worksheet for the property that had the two assets that we used Section 179 for (and they totaled to $816)
- found the "Carryovers to 2021 Smart Worksheet"
- For Line A: Section 179 carryover, manually entered $816 as a positive number
Here is what happened:
- Good news: The Carryover Worksheet and Line 24 Column 1 in the Carryover Worksheet were no longer flagged as being in error by Turbo Tax, as seen in the Form View. The pink shading of the field was gone, as was the red exclamation point by the form name Carryover Worksheet in the list of forms
- More Good news: Turbo Tax automatically created a Form 4562 Depreciation & Amortization for the correct activity and correctly populated the Form 4562 with the $816 as a carryover from 2020 in Line 10. Turbo Tax also correctly placed the $816 in Line 13 to carryover this deduction to 2022 because the rental property also had a loss in 2021.
- The Bad News: In the Forms View: 1) Now in the Schedule E worksheet, in the Carryovers to 2021 Smart Worksheet section, Line A is shaded pink and flagged as being in error by Turbo Tax. 2) The Schedule E Worksheet now has the dreaded red exclamation point next to in the Forms View
Is there a way to correct this so the $816 is carried over from 2020 to 2021 and then indicated to be carried over to 2022 without errors popping up in Turbo Tax? What am I doing wrong here?
Thanks for your help, Think57
