rental depreciation - schd E wksht, column c & d - where is source of "reported in Schd E"??? Very low.

[bnbalison2]

I find that the Schd E worksheet line 18 depreciation column a is correct, but column c is very small, and does not even match the % of "rented" days.   Does it have to do with the column d "vacation home loss limitation"?

Help!    I can't find anything in IRS publications or Turbotax help.

Thanks!

[Anonymous_]

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@bnbalison2 wrote:

 Does it have to do with the column d "vacation home loss limitation"?

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That is entirely possible as the depreciation deductions would abate before other, actual, expenses such as for repairs and maintenance.

[bnbalison2]

I was hoping for someone to tell me the source of the number. TurboTax usually gives the source link but this number appears magically from nowhere with Jo hint of how it’s calculated…..all I have is guesses which are not helpful Thanks

[bnbalison2]

I was hoping for someone to tell me the source of the number. TurboTax usually gives the source link but this number appears magically from nowhere with no hint of how it’s calculated…..all I have is guesses which are not helpful Thanks

[DavidD66]

Most likely, yes it is due to the vacation home loss limitation.  If you have a vacation home, and you use it for personal purposes for more than the greater of these:

• 14 days
• 10% of the total number of days you rent the home at fair rental value

Then your vacation home qualifies as a personal residence, and the vacation-home rules apply. These rules limit deductible expenses to rental income. Deductions are allowed in the following order and to the following extent:

1. Tier 1: The rental portion of deductions that are allowed without regard to rental use, such as the deductions for property taxes, qualifying home mortgage interest, and casualty losses are deductible as rental expenses to the extent of the gross rental income from the unit.

2. Tier 2:  The allocable rental expenses directly related to the rental property itself, including advertising, commissions, Insurance, repairs, and utilities are deductible to the extent that they exceed gross rental income reduced by the first-tier expenses.

3. Tier 3: Allocable depreciation and other amounts that result in an adjustment to basis are allowed to the extent that they exceed gross rental income reduced by the first  and
second-tier expenses.

Little or no allowable depreciation is common with vacation rentals.  For more information, and a Worksheet for Figuring Rental Deductions for a Dwelling Unit Used as a Home, go to:

IRS Publication 527 - Reporting Income and Deductions

[bnbalison2]

Awesome, yes that makes sense based on what I'm seeing. Basically if you use your vacation home for more than 10% of the rental time, then IRS limits you to a zero profit. If you use it less than 10% of the rental time, IRS allows up to a $25K loss by using some of the listed expense tiers you gave. Still, it would be nice for Turbotax to provide visibility and links, as the numbers simply populate fields, leaving me to dig and create excel spreadsheets to duplicate and track what is being used or omitted. i.e. I now have a great qualitative understanding, but still no clue about where Turbotax is pulling numbers from for deprecation numbers. Thanks again for a great breakdown of the expense tiers.