4562 (Depreciation and Amortization) UPDATED - claim that accelerated depreciation !!!!!!

[user17713903011]

TurboTax Form 4562 (Depreciation and Amortization) has been updated for 2025

Updated depreciation calculations for Schedule E (Rental Properties) are now available as of February 20, 2026.

Claim that accelerated depreciation !!!!!! 

[dcv115]

Unfortunately, even with the 2/20 update, the Form 4562 does not generate accurately if you have more than one rental property from the online/computer interface.  Although there should be a separate Form 4562 for each property, when questioning the TurboTax AI assistant, it states that TurboTax generates a single Form 4562 that compiles data for all properties.  Unfortunately, the single Form 4562 that is generated only has the data for Property A from the Schedule E.  All appropriate data for Property B is represented accurately on the Schedule E (particularly Line 18); however, that data is not compiled on the Form 4562.  That is, Line 17 on Form 4562 only has the data for Property A from Line 18 of Schedule E.  Additionally, the business/activity identified at the top of the form is only that of Property A.  This bug directly impacts the state return that uses Form 4562 directly as well.  I spent more than an hour with a nice and helpful tax expert where we exhausted all plausible troubleshooting.  She brought in a tech specialist who had me delete all cache/cookies and even download a different browser, clear the cache/cookies, and regenerate the review forms.  All the same problems exist.  Please correct this bug in the code to ensure that all data from multiple rental properties are represented on 4562 forms and let the community know when complete! Thank you!

[DianeW777]

If you would like to send us a “diagnostic” file that has your “numbers” but not your personal information it would help.  If you would like to do this, here are the instructions:  (Don't forget to give us the state)

TurboTax Online:

Open your return -Go to the menu panel on the left side of your return and select Tax Tools. 

1. Then select Tools below Tax Tools.
2. A window will pop up which says Tools Center.  
3. On this screen, select Share my file with Agent.
4. You will see a message explaining what the diagnostic copy is.  Click okay through this screen and then you will get a Token number.
5. Reply to this thread with your Token number and your state. This will allow us to open a copy of your return without seeing any personal information.

TurboTax Desktop:

If you like, you can send a copy of your return that will be scrubbed to eliminate your personal data by using these steps:

1. Click on Online in the top left menu of TurboTax Desktop for Windows
2. Select 'Send Tax File to Agent'* > Follow the prompts to reach the token number.
   • Enter your email used for TurboTax > Enter your code > Send
3. Write down or send an image of your token number and state then place in this issue.
4. We can then review your exact scenario for a solution.
5. Please also tell us any states included in the return. This is necessary for us to view the return.
   • *If using a MAC, go to the menu at the top of the screen, select Help, then, 'Send Tax File to Agent')

We will be able to see exactly what you are seeing and we can determine what exactly is going on in your return to provide you with a resolution.

@dcv115 

[dcv115]

Thank you very much!!  My Token # is 1332829

I have two states that require a return, CA and PA.  I've noticed that the federal Form 4562 error directly impacts the CA Form 3885A that uses the federal Form 4562 directly.  I have not determined whether or not the PA return is also impacted, so I'd greatly appreciate if you could determine that and fix if necessary.  Thanks so much!

[DianeW777]

When I look at the return, the depreciation is correct and there is one Form 4562 for each property as well as depreciation. Since you did not have any new assets placed on depreciation in 2025, this form is not actually required to be filed with the tax return.

Likewise both Schedules E have the appropriate depreciation listed on Line 18. Notice the income for property A does allow a loss of the same amount ($2,228 -$2,338) creating a zero income for Schedule E for the federal return. 

California (CA): Based on my quick review, CA follows the same passive activity rules as federal since 2015. The Form 3801 correctly allows the same loss as indicated for the federal return.

• California generally follows federal conformity for Passive Activity Loss (PAL) rules under Internal Revenue Code (IRC) Section 469. This means that, like the federal rules, California limits your ability to use losses from "passive" activities (like most rental properties or businesses you don't actively run) to offset "active" income like your salary.
  However, because California has different rules for some underlying items—most notably depreciation—your total allowable loss for California will often differ from your federal amount.
• IRS Form 8582: Calculating Passive Activity Losses (PALs) for Real Estate

Pennsylvania (PA): PA law has never changed. They recognize the loss of income within a category of income, however no loss in one category can offset any income in another category.

• Example: A rental loss cannot offset wages or any other class of income. 

Please update if you have additional questions or details that may help clear any confusion.

@dcv115 

[dcv115]

Thank you for putting the time into reviewing all of that information.  I do appreciate it.  There does still seem to be either some confusion about the Form 4562 and CA Form 3885A, or the file the TurboTax is providing me is different than what you are able to see.  There are no issues with any of the other aspects of the return that you described--on the same page there.

First, while I do see the unofficial worksheets titled Form 4562 and CA Form 3885A for both properties with all of the appropriate depreciation calculations for both properties to support the data that should be entered on the federal Form 4562 and CA Form 3885A, there is only a single Form 4562 and CA Form 3885A for one property (Property A on the Schedule E).  None of the depreciation data for the second property (Property B on the Schedule E) is included on that single Form 4562 or CA Form 3885A.  Note that the identical Federal Form 4562 for Property A is included a second time in the file presumably because CA requires that form to be filed to support the CA Form 3885A data.  That second instance of the Form 4562 also has the address associated with Property A and also does not include the data for Property B.   This detail can be seen by comparing it to the unofficial Form 4562 worksheet provided by TurboTax as part of the larger printable file.

Secondly, you note in your response "Since you did not have any new assets placed on depreciation in 2025, this form [Form 4562] is not actually required to be filed with the tax return."  That statement is not consistent with the instructions for the 2025 Form 4562.  These instructions say:

"Who Must File

Except as otherwise noted, complete and file Form 4562 if you are claiming any of the following.

...

• Depreciation on any vehicle or other listed property (regardless of when it was placed in service)."

Because both properties had depreciations deducted in 2025, Form 4562 is required even though none of those assets were placed into service in 2025.

Prior to filing through TurboTax, am I able to make the necessary changes to the file? I would need to add a Form 4562 for Property B to both the federal return and CA return and add a CA Form 3885A for Property B to the CA return.  Is that a change I'm able to manually make in the TurboTax Online interface prior to officially submitting my returns?

Alternatively, is the please somebody at TurboTax who can make these last minor necessary changes to my returns so that I can please file ASAP?  Thank you! @DianeW777 

[AmeliesUncle]

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@dcv115 wrote:

• Depreciation on any vehicle or other listed property (regardless of when it was placed in service)."

Because both properties had depreciations deducted in 2025,

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Just to clarify, are you saying it had depreciation of a "vehicle or other listed property"?  Depreciation of the property itself and most other assets do not required a 4562.

[dcv115]

Thank you for your input, @AmeliesUncle .  I agree there are some intricacies about when a Form 4562 is required vs recommended to track ongoing depreciation deductions from year-to-year.  There are assets related to both properties (Property A & Property B) that are being depreciated, and that depreciation is being deducted separately for each property on Line 18 of the Schedule E.  TurboTax online is generating a single Form 4562 for Property A.  There has not been an explanation for why one Form 4562 is being provided but not the second Form 4562.  Would it be required/included for just one property for some reason? Neither property had assets placed in service in 2025.  The AI assistant stated that a single Form 4562 would be provided that includes depreciation for all (both in my case) properties.  That is not the case in my review draft--only Property A data is included.  I hope someone can provide an explanation or a remedy.

Alternatively, can someone answer the TurboTax online interface question about whether or not I can manually add tax forms prior to filing? Or if a technician can do that for me?  The Form 1040 indicates that it is "Self Prepared," so that seems like a reasonable request if TurboTax takes no responsibility for the returns.

Thanks for the help!