Cost basis, depreciation and mortgage interest allocation when renting out part of home

[susannawtang]

My daughter bought a duplex last year. She lived there and rented out part of the property. In the Depreciation and Amortization Report, the cost basis generated by TurboTax is not the prorated percentage of the cost basis of the property less Land value. How is that Cost value calculated? On Schedule A, TurboTax did not prorate the mortgage interest but gave her the entire deduction of mortgage interest and points reported on Form 1098.  On Schedule E Worksheet, the mortgage interest was prorated with the proper amount allocated to personal use. Is Schedule A correct?

[Critter-3]

If she has a duplex and lives in one unit and rents the other then in the program she needs to treat the rental portion as it's own separate property and prorate the common expenses yourself.  Enter it as a 100% rental for the unit being rented ... do NOT indicate the rental unit was used personally at all ... doing so will trigger the vacation home rules which you do not want or need.  

[susannawtang]

She shares part of one unit with a renter. Schedule E worksheet has Owner-Occupied Rentals section, item P Check to allocation personal use items to Schedule A box checked and item Q Percentage of rental use 71.43%. So TurboTax should be prorating the figures based on the percentage.

[Critter-3]

BEFORE filing you need to review everything carefully to make sure everything was entered correctly.  

[susannawtang]

It's not knowing how TurboTax determine/calculate the numbers.

[Critter-3]

If you are not sure how to read the tax forms then I highly recommend you seek professional assistance to review the return and educate you for the future. 

[susannawtang]

I believe TT did not calculate the proration correctly. 

[Critter-3]

Using the PRINT CENTER option under TOOLS save a PDF with all the worksheets to see the proration details.  You do have the option to enter the prorated amounts yourself ... just do not enter any personal use days.