Turbo Tax Desktop Premier Issues

[sbachawat1979]

I am entering my rental property information on the Turbo Tax desktop Premier version and it does not take the depreciation amount while calculating the expenses. Can someone please tell me what is wrong?

I have entered

1) Purchase price of the property

2) Cost of Land

3) Date it was acquired

4) How many days it was rented in 2022.

Thanks,

[PatriciaV]

Some items to review under Assets/Depreciation on the page "Tell Us More About This Rental Asset":

1. Checked "I purchased this asset."

2. Checked "Yes, I've always used this item 100% for business." and entered the date you first started using it.

The next page should confirm prior depreciation (if any). Then you should see the Asset Summary with a box to check to "Show Details." Check the box and confirm the information is correct. Your depreciation expense for the year will be shown under the property description.

[sbachawat1979]

Thanks. The software is calculating the depreciation but when you check the deduction under Assets/Depreciation it shows up as zero.

[sbachawat1979]

The property was not fully used for rental purposes last year so I marked it to ensure that I do not take credit for the full year. It shows me the depreciation amount under " Your Property Assets", keeps special depreciation and Section 179 as zero. When I click on Done and come back to the " Review your rental summary" it shows me the total for Rental Income and Expenses and keeps the Assets/Depreciation as zero. I am not sure how to get this fixed as without the depreciation expense I would be overpaying taxes. Any insights? I am using the Turbo Tax Desktop Premier version for Mac like every year.

[PatriciaV]

Have you looked at Schedule E for this property to confirm no depreciation expense is reported on Line 18? Sometimes the summary page doesn't display all expenses as shown on Schedule E.

[sbachawat1979]

I looked up Schedule E and Depreciation Expense or depletion shows as zero. On the Schedule E worksheet it shows 0 as " Reported on Schedule E" and puts the entire depreciation amount under " Vacation Home Loss Limitation". Also the amounts in the forms are in black so I cannot edit it either. Please advise. Thanks.

[sbachawat1979]

I deleted and re entered my rental income information and still Depreciation shows up as '0'. I am struggling on this one and not sure how I can file my taxes now.

[DawnC]

How many days of rental use did you enter and how many days of personal use did you enter?  If you use the place for more than 14 days or more than 10% of the number of days it is rented -- whichever is greater -- it is considered a personal residence.  

[sbachawat1979]

I have entered it being rented for 300 days and personal use for 64 days.

[sbachawat1979]

Is it because the rental losses are limited based on income?

https://www.taxaudit.com/tax-audit-blog/can-i-deduct-rental-property-losses

[DawnC]

No, it is not calculating depreciation, because the residence is considered personal property.   You have more than 10% personal days.  Are you sure you have 64 personal days?   Personal days should probably be zero.    If you starting renting on March 1st and rented it the remainder of the year, you have no personal days.   It is asking for personal days after you converted or started using it as a rental property.   If you change personal days to zero, the depreciation will calculate.   Although you may need to delete the asset and re-enter it. 

TurboTax will prorate your depreciation based on the placed in service date, so don't count personal days before that date.   

[sbachawat1979]

Thanks for the response. I followed your suggestion and it does calculate the depreciation now. Though I have a loss on the rental income after deducting depreciation it does not reduce my income and hence my taxes are the same. Is this correct?

[PatriciaV]

Yes, depreciation cannot result in a tax loss for the year. Instead, that loss is carried forward to offset passive income in future years.

[sbachawat1979]

Thanks for the response. How can one make sure that the rental income loss will be carried over to next year to be deducted against next year's income? All my calculations are completed and I have passive rental income loss (mainly due to depreciation). Thanks for the advise.