4562 form not generated ???

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I'm printing out forms for State filing(print and send in).

I have entered property rental info and my TT has generated 4562 Depr and Amo "REPORT" but where is the 4562 FORM??

TurboTax Premier Windows

tealover753Author

Level 2

Hi Carl,
It's my first time filing using TT.
So, basically the property has been rented for the last since 2016 and nothing is changed, but
the CPA we've been using has been filing 4562 in as "Recomputed for Hawaii", because of this...??
Depreciation and Gain Adjustments
Note: Hawaii did not adopt the federal provisions for bonus depreciation, increased IRC section 179 deduction (Hawaii limit is $25,000), and inclusion of off-the-shelf computer software as property qualifying for the IRC section 179 deduction.......

Anyways, so, in order for my first TT to create 4562, do I need to enter 2017's info? or
Can I attach TT's 4562 report...which I don't think so...
Or should I just download F4562 from fed website, enter numbers from last year and send it in...???

HI's N-11 filing instruction says to file F4562...

Carl

Level 11

If nothing changed from last year (adding or disposing of an asset) then it's not required or necessary to file the form with the return. Therefore the form is not generated. The current year depreciation is shown on line 18 of the SCH E.

joannabanana6

Level 3

SO glad I found this post! Your response was a HUGE help...thank you!!! 😊

Carl

Level 11

F4562 and IRS form 4562 are two physically different forms.
"do I need to enter 2017's "
Not sure in what context you're asking this. Since you started renting out the property in 2016 and 2018 is your first year with TTX, you must work this through the assets/depreciation section. To enter the data correctly you need the 2017 IRS Form 4562 titled "Depreciation & Amortization Report". You may or may not also need the one titled "Alternative Minimum Tax Depreciation".
When working this through the program you will be asked for prior year's depreciation (or depreciation already taken) It's important to enter the correct amount, and folks in your specific situation enter the wrong amount 99% of the time. To get the correct amount, take a look at the 2017 4562 and add together the amounts in the prior depreciation column and current depreciation column.
You will enter that total in the TTX program when asked for prior depreciation already taken.
Now for the HI state return, the data from the federal return is imported to the state and dealt with mathematically as necessary. But you "still" have to work it through the state program, even if you don't change anything on any of the screens.
Then when you print the state return, the HI form F4562 will be generated with that, if it's necessary to file that form with the state. (it may not be if there's no changes to your assets from the 2017 form F4562)
Not that it applies directly to you your specific situation, but I've added some important info in the answer box below for your reference. When dealing with rental property, I can't stress the importance of absolute perfection in the first year of renting, or in the first year of using TurboTax. Even the tiniest of mistakes will get exponentially larger over time. Then with you catch (if the IRS doesn't catch it first) the cost of fixing it years down the road *will* be expensive. so when it comes to the numbers, perfection for you is not an option....it's a must.

tealover753Author

Level 2

Hi Carl,
Thank you for the details.
> you will be asked for prior year's depreciation
Yes, I have worked through the “Assets/depreciation section” from Rental Property based on the past two years' 4562 documents.
On “Confirm your prior Depreciation” section, “Amount of Depreciation taken in Prior Years”: I looked at both depreciation numbers for the first year 2016’s-and, 2017’s, then entered the total amount “$136,424”.
On “Asset Summary” section, came out the correct estimated expense for this year, meaning the same amount from the second year(2017) on. (based on 27.5 yr SL/MM method)
Then that’s it. All answered, but I see no 4562 form.

>HI State,…you sill have to work it through the program….
Yes, I have worked through all correctly for HI. There is no changes, no extra addition. Quite simple.
I looked at files from “Print” section and Still no 4562 form…

Now, you said,
>Then when you print the state return, the HI form F4562 will be generated with that, if it's necessary to file that form with the state.
So, am I correct that TTx does not generate F4562, because it is not necessary for us because there was no changes/improvements etc made to this asset since 2017 and the depreciation amount is the same?

Carl

Level 11

While I can't speak for the state of HI specifically, if the F4562 was not generated, then I would assume it's not needed. I left HI almost 20 years ago, and things have changed a bit in that time.
HI is mainly concerned with you paying taxes on your rental income, as well as the GET and if short term (180 days or less) they assess a TAT tax too. When it comes to taxes, the only state that taxes its residents more, is CA.

Carl

Level 11

Rental Property Dates & Numbers That Matter.

Date of Conversion - If this was your primary residence before, then this date is the day AFTER you moved out.
In Service Date - This is the date a renter "could" have moved in. Usually, this date is the day you put the FOR RENT sign in the front yard.
Number of days Rented - the day count for this starts from the first day a renter "could" have moved in. That should be your "in service" date if you were asked for that. Vacant periods between renters count also PROVIDED you did not live in the house for one single day during said period of vacancy.
Days of Personal Use - This number will be a big fat ZERO. Read the screen. It's asking for the number of days you lived in the property AFTER you converted it to a rental. I seriously doubt (though it is possible) that you lived in the house (or space, if renting a part of your home) as your primary residence or 2nd home, after you converted it to a rental.
Business Use Percentage. 100%. I'll put that in words so there's no doubt I didn't make a typo here. One Hundred Percent. After you converted this property or space to rental use, it was one hundred percent business use. What you used it for prior to the date of conversion doesn't count.

RENTAL POPERTY ASSETS, MAINTENANCE/CLEANING/REPAIRS DEFINED

Property Improvement.

Property improvements are expenses you incur that add value to the property. Expenses for this are entered in the Assets/Depreciation section and depreciated over time. Property improvements can be done at any time after your initial purchase of the property. It does not matter if it was your residence or a rental at the time of the improvement. It still adds value to the property.

To be classified as a property improvement, two criteria must be met:

1) The improvement must become "a material part of" the property. For example, remodeling the bathroom, new cabinets or appliances in the kitchen. New carpet. Replacing that old Central Air unit.

2) The improvement must add "real" value to the property. In other words, when the property is appraised by a qualified, certified, licensed property appraiser, he will appraise it at a higher value, than he would have without the improvements.

Cleaning & Maintenance

Those expenses incurred to maintain the rental property and it's assets in the useable condition the property and/or asset was designed and intended for. Routine cleaning and maintenance expenses are only deductible if they are incurred while the property is classified as a rental. Cleaning and maintenance expenses incurred in the process of preparing the property for rent are not deductible.

Repair

Those expenses incurred to return the property or it's assets to the same useable condition they were in, prior to the event that caused the property or asset to be unusable. Repair expenses incurred are only deductible if incurred while the property is classified as a rental. Repair costs incurred in the process of preparing the property for rent are not deductible.

Additional clarifications: Painting a room does not qualify as a property improvement. While the paint does become “a material part of” the property, from the perspective of a property appraiser, it doesn’t add “real value” to the property.

However, when you do something like convert the garage into a 3rd bedroom for example, making a 2 bedroom house into a 3 bedroom house adds “real value”. Of course, when you convert the garage to a bedroom, you’re going to paint it. But you will include the cost of painting as a part of the property improvement – not an expense separate from it.

chaosfog

Level 2

After struggling to make form 4562 appear I found the solution. You need to enter a car used for your business just enter 0 as expenses and Boom the form appears. Not sure why is the case, perhaps IRS only cares if you are using a car for your business.