Sign Up

Why sign in to the Community?

  • Submit a question
  • Check your notifications
or and start working on your taxes
cancel
Showing results for 
Search instead for 
Did you mean: 
auntb1908
New Member

Depreciation never taken on rental property

Looks like my tax preparer never depreciated my rental property that I inherited in '96 and began renting out the following year.  It appears I should have recaptured about $96000 by now.  What are my options or is that all lost?  Per Pub 17, the depreciation is recaptured and added to the cost basis whether you take it or not.
1 Best answer

Accepted Solutions
TaxGuyBill
Level 9

Depreciation never taken on rental property

You need to 'catch up' on the depreciation by means of Form 3115.

However, this is a confusing form and TurboTax does not support it.  I highly recommend going to a tax professional (preferably one who has experience with Form 3115) to have them do your tax return this year.

http://taxexperts.naea.org/


When you talk to the tax professional, the proper terminology is that you should have "depreciated" about $96,000 by now, and "depreciation" lowers your basis.  Recapture (for real estate, it technically is "Unrecaptured Section 1250 Gain") happens when you sell the property and you owe tax based on the depreciation that you took.

View solution in original post

3 Replies
lzup2
New Member

Depreciation never taken on rental property

The system would not import my information from2014??
ghost
Level 8

Depreciation never taken on rental property

@TaxGuyBill
I remember you answered one like this a few weeks ago but I couldn't find the thread. Can you help?
TaxGuyBill
Level 9

Depreciation never taken on rental property

You need to 'catch up' on the depreciation by means of Form 3115.

However, this is a confusing form and TurboTax does not support it.  I highly recommend going to a tax professional (preferably one who has experience with Form 3115) to have them do your tax return this year.

http://taxexperts.naea.org/


When you talk to the tax professional, the proper terminology is that you should have "depreciated" about $96,000 by now, and "depreciation" lowers your basis.  Recapture (for real estate, it technically is "Unrecaptured Section 1250 Gain") happens when you sell the property and you owe tax based on the depreciation that you took.
Dynamic AdsDynamic Ads
Privacy Settings
v