Rental house owner died in 2019. I need to prorate depreciation for the before and after death returns. Turbotax won't let me change depreciation amount. How is it done?

Turbotax has been keeping track of the depreciation over the years.

posted

You don't pro-rate depreciation. Transfer the property to the estate return by showing it as removed for personal use on the date of their passing, on the personal return. Then enter it on the estate return. Upon transfer to the estate there's a step-up in basis to the FMV of the property on the date the owner passed and all prior depreciation "disappears".

If unsure on this (and many are) then please seek professional help for the 2019 tax return (both the 1040 and 1041). Upon transfer to the beneficiary recipient, they get the step-up in basis and do *NOT* take the depreciation with them. For them, everything starts over from scratch with the stepped up basis.

Professional help is especially called for if the state of deceased also taxes personal income.