topic Smart Check Errors in Investors & landlords

Smart Check Errors

RAH727 — Mon, 09 Mar 2026 08:09:18 GMT

Sold my rental. I disposed of the "improvements" listed as best I know how. I did not manually enter any of the depreciation numbers. Just the sale numbers as part of my rental sale.

After running the errors check I got the following errors:

Error: Depreciation Method Is Incorrect. The box populated with the 200% Declining Balance.

Opening the box reveals other choices:

150% Declining balance

Straight Line

Prescribed ACRS

Alt Method

125% Declining balance

Error: Prior Depreciation is too large. For disposition calculations, depreciation cannot exceed business basis

Error: Recovery Period Must be entered

The only thing I can think of is that I changed how I classified those assets differently after realizing I may have misclassified them originally. Suggestions?

Re: Smart Check Errors

PatriciaV — Mon, 14 Mar 2022 16:39:40 GMT

Residential Real Estate, including Improvements, is depreciated using the Straight-Line method.

To confirm you set up this property correctly, review your Depreciation Report from last year. In the Method/Convention column, you should see SL/MM (straight line/mid-month). The recovery period (Life) should be 27.5. Also confirm that the total depreciation (prior plus current) at the end of last year was not more than the Cost of the asset.

Note that you cannot change your depreciation settings once you begin depreciating an asset, unless you made a mistake. Even then, you need IRS approval to correct the error.

Re: Smart Check Errors

RAH727 — Wed, 16 Mar 2022 19:30:34 GMT

Thank you!