Turbotax Premier - Tell Us More About This Rental Asset selection vs. IRS Form 4562

[mikee21]

Rental property was given to me as a gift. While setting it up in Turbotax, new asset/rental, under "Tell Us More About This Asset" I've mistakenly selected "I purchased this asset new" instead of "None of the above". Dumb, I know. Considering you have 'new' in bold and Learn More link right next to it explaining what to do. Nevertheless, in my case Depreciation deduction stays the same regardless of the selection. I wanted to amend filed federal, but there is nothing for me to correct/fix on that Form 4562 - Depreciation and Amortization. How would you go about it? Should I even bother? Thx.

[Carl]

If amending the return will not change your depreciation or your tax liability, then don't bother.

Understand that when you receive rental property as a gift, several things that matter.

- Your cost basis is the same as the cost basis of the person who gave it to you. Make sure that cost basis includes the cost of any property improvements done by the giver, before they gave it to you.

- All the prior depreciation taken by the giver, is also passed on to you. So if you're not showing a positive number for prior year's depreciation taken, it's possible you didn't enter things correctly. (It's also possible you did. It just depends on how you dealt with the original cost basis of the giver to account for that prior depreciation taken before you acquired it.)

- All carry over losses become yours too. But due to tax law changes on this in 2018, it's perfectly possible there are no carry over losses.