I have a rental property in a foreign country. How do I fill section E "Depreciation expense or depletion"? And how do I calculate it?

[M-MTax]

Foreign residential rental property is depreciated over 30 years.

[ColeenD3]

Enter the information as you normally would. You will encounter a screen that asks if the property is in the US or if it is foreign. Once you click that it is foreign, you will be able to enter the address of the property.

As noted above depreciation is over 30 years, if it was entered into service after 2017. If it was entered before 2017, it is depreciated over 40 years.

[noambehar]

Hi, can you please clarify your last statement with more detail?
1. Not sure I understand this and how do I calculate the depreciation amount? what do you mean "entered into service"?
Let's take an example, apartment in a foreign country that was built in 1980, and its cost basis is 300K$. How do I calculate this?

2. After I know the answer to #1, I couldn't find in the TurboTax UI a place where I can fill this in. Can you tell me how to navigate to it?

Thanks,

Noam

[ErnieS0]

What @ColeenD3 means by “entered into service” is the date you started renting the property. TurboTax will ask for two dates: (1) Date purchased or acquired, and (2) The date you first started using the property for business (entered into service date). These dates may be different if you converted a property from personal to business use.

To correctly calculate foreign depreciation, it is important to have to correct property profile in TurboTax Desktop/CD.

• Go to Rental Property and Royalties,
• Continue until you reach the Review screen.
• Start/Update General Property Information in Property Profile.
• Choose Foreign County in the property information screen (Is This a Rental Property or Royalty?)
• Fill in the foreign address and country,
• Continue filling in information until you reach Is Your Property in Any of These Designated Areas?
• Select Assets for this property are located outside of the United States or United States possessions,
• Select All of the assets for this property are located outside of the United States or United States possessions.

This will set up foreign depreciation.

• Go to Assets/Depreciation,
• Select Add an Asset,
• Fill in the information about your property,
• Click Show Details in Asset Summary. If you entered everything correctly, you should see 30-year depreciation and ALT Depreciation Method.

[noambehar]

Thanks, I will give this a try and update