I have three rental properties and have vehicle expense "mileage" for each using the same vehicle. It seems like its reasking the same questions on the second property?

[jim11amy]

Is there a step I'm missing so I don't need to reenter or possibly double up info on the same vehicle?

[PatriciaV · Accepted solution]

Yes, enter vehicle expenses for each business as if there was a different vehicle for each business. 

Enter the same vehicle information, and beginning/ending mileage (or total/commuting miles). 

However, the actual business miles for each business would be different.

[mbm2]

I have a similar situation. If I aggregate miles across all three rentals on one rental business use miles exceeds the 50% business use requirement to qualify for special depreciation, if I use the miles across each rental separately, none of the rentals can qualify for special depreciation, thus I miss out on the special depreciation. Any recommendations on how to handle such situations?

[Carl]

I've got 3 rentals myself, and in the past discovered that claiming vehicle use was an absolute and total waste of my time. It made no difference to my tax liability. Not one single penny. That's because even without claiming vehicle use, rental property always operates at a loss on paper, at tax time. Since claming vehicle use on my rentals each year doesn't make a penny of difference to my tax liability, why bother?

If I aggregate miles across all three rentals on one rental business use miles exceeds the 50% business use requirement to qualify for special depreciation,

It still will not make one penny of difference in  your tax liability. All you're doing is increasing the paperwork you have to do, and getting nothing in return.

Most folks don't realize that a part of that "per-mile" deduction  you get each year is depreciation. Then when you sell, trade-in or otherwise dispose of the vehicle later, you have to recapture all that depreciation. To top it off, since the per-mile deduction changes every year, so does the amount of each mile change that is depreciation. So it's a paperwork nightmare to track, and even more so when you dispose of the vehicle.... and you're doing it all for no gain what-so-ever.

[AmeliesUncle]

@Carl   But the vehicle deduction DOES increase your Passive Loss carryover.  So if you aren't claiming a valid vehicle deduction, you are losing out on the carryover.

@mbm2  To get around that program limitation, this is what I would do: 

1. Enter it all under one property.
2. Of the total vehicle deduction, manually calculate what belongs to the other two properties.  Add that combined amount to the income of the first property.  So the net effect is the first property will only get the deduction for the vehicle expenses for that first property.
3. Add an 'other' deduction to the other two properties, using your manual calculation from step 2.

[Carl]

Sure it does. But you still have to recapture depreciation whenever you dispose of the vehicle. It's not worth it for the most part, because when you recapture that depreciation that too generally doesn't make any difference. Even with the recaptured depreciation you're still gonna sell/trade-in the vehicle at a loss. But only get to deduct the business use portion of the loss. If you're driving less than 10% business miles a year, it's a whole lotta paperwork for no gain.

Remember, that 50% special depreciation allowance is not a permanent deduction by any stretch of the imagination. It has to be recaptured in the year you sell/trade-in the vehicle, and that recapture increases your AGI. It "could" have the potential to put you in the next higher tax bracket too.

[AmeliesUncle]

Carl, first, "recapture" only happens when you sell it at gain.  [Edit: With a vehicle, "recapture" or recalculating can also happen if vehicle drops below 50% business usage].  Second, you need to "recapture" it whether or not you actually claim it.

Intentionally leaving something off your tax return (such as the "recapture" of the depreciation that SHOULD have been taken) is tax fraud.

[clparrish93]

You are exactly right. You can also deduct up to 25k of passive business loses against W2 income.

I am in the same exact situation where across multiple properties my business use is > 50%, but for each individual property it calculates as < 50%.

Even when doing the standard mileage method, Turbotax requires you to input redundant information for every single property. Then when you sale the vehicles it fails to properly capture the mechanics of depreciation recapture. Each individual year has a depreciation portion and it changes by $0.01 to $0.02 yearly.

The actual expense method in Turbotax is even more confusing like you said. It removes the option for bonus depreciation and section 179 expensing if you do each property individually even though the aggregate is > 50%.

[blamuk]

But this causes inconsistent information on form 4562 line 33. 

Lets say i drove 30k miles total that year on that vehicle. I have 3 properties, and I drove 1k miles for property A, 2k for property B, and 3k for property C, therefore 6k total miles driven for all properties), and the remainder (24k miles) was for personal use. 

If i had entered the info like you said, I'd have a different number on each of the form 4562 line 33 (total miles driven during the year, add line 30 through 32) because line 32 (total other personal miles) should be constant?

What i am trying to say is, because line 30+32 = 33, and line 30 is different for every property, and line 32 should be constant by definition, line 33 will be different for each property which makes no sense. 

What am i missing?