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Level 3
posted Aug 18, 2022 10:56:26 AM

Form 3115 Change in Accounting method

Hello,  thanks for your help in advance.  I need to change the accounting method for 4 properties acquired in 2019 in order to be able to deduct the separate items in a cost segregation study that I had done for those 4 properties.

 

My question is:  Will I be able to deduct the items in the cost segregation study (site improvements (15 year), and Equipment/Furnishings (5 year)) in their ENTIRETY (i.g. as a Special Depreciation Allowance) for my 2021 taxes?

 

if so, Does turbotax desktop premium allow this do be done in the application?

 

thanks again

 

 

0 8 1965
2 Best answers
Level 15
Aug 18, 2022 11:21:25 AM

The Premier version of TurboTax desktop will suffice for your purposes.

 

However, as was explained in previous posts, you will have to use Forms Mode and, possibly, make overrides.

 

Further, you will have to print and mail your return since Form 3115 is not supported for e-file.

Level 15
Aug 18, 2022 11:47:55 AM

Additionally, note that Parts I and II will have to be completed and there are several questions that are rather obtuse.

 

Beyond the IRS instructions for the form, there are few elsewhere on which to rely. TurboTax offers virtually no guidance for Form 3115.

 

If you are having difficulty comprehending how to complete the form, you might be better off consulting a local tax professional who is thoroughly familiar with the process.

8 Replies
Level 15
Aug 18, 2022 11:21:25 AM

The Premier version of TurboTax desktop will suffice for your purposes.

 

However, as was explained in previous posts, you will have to use Forms Mode and, possibly, make overrides.

 

Further, you will have to print and mail your return since Form 3115 is not supported for e-file.

Level 3
Aug 18, 2022 11:28:25 AM

Thanks for your reply.  By any chance do you have instructions on what selections to make in turbotax in order to take the deducions in their entirety for the tax year in question, and also instructions on how to input the 3115 form?

 

thanks again for your help

Level 15
Aug 18, 2022 11:42:02 AM

See https://www.irs.gov/instructions/i3115#idm140516453720416

 

Also, note that you need to attach a summary of the computation and an explanation of the methodology used to determine the section 481(a) adjustment.

Level 15
Aug 18, 2022 11:47:55 AM

Additionally, note that Parts I and II will have to be completed and there are several questions that are rather obtuse.

 

Beyond the IRS instructions for the form, there are few elsewhere on which to rely. TurboTax offers virtually no guidance for Form 3115.

 

If you are having difficulty comprehending how to complete the form, you might be better off consulting a local tax professional who is thoroughly familiar with the process.

Level 3
Aug 18, 2022 12:03:09 PM

thanks, I was also wondering if you had any guidance on how to access and include this form 3115 in the actually TT application?

 

thanks again

Level 15
Aug 18, 2022 12:26:49 PM

As you have already been told at least twice, Form 3115 is only supported in forms mode in TurboTax. There is no support for it at all in the Step-by-Step interview. To switch to forms mode click the Forms icon (at the top right if you are using TurboTax in Windows). In forms mode, click Open Form. In the space for the form name type 3115. Then select the form in the list and click the Open Form button.

 

Level 3
Aug 18, 2022 12:31:30 PM

thank you

Level 15
Aug 18, 2022 12:42:19 PM

In addition, do not forget to add blank statements (sheets) in Forms Mode on which you can type your computations. 

 

Again, you would be best advised to seek guidance from a local tax professional.