Asset Entry when claiming Disabled Access Credit and Section 179

[mquilter]

TurboTax product:  Home and Business (download)

In 2020, we purchased a piece of equipment for sole-proprietorship business (filing Schedule C).  This equipment qualifies for the Disabled Access Credit (form 8826, the credit of which carries over to Form 3800, General Business Credit).  My question relates to the asset entry in TurboTax H&B when I will be claiming both the maximum disabled access credit of $5,000 and expensing the remaining cost as a Section 179 deduction, so that TurboTax does not calculate depreciation on the asset in future tax years.

Here's the Scenario:

Asset purchase cost:  $11,641

Disabled access credit:  $5,000 (via form 8826 and 3800)

Section 179 deduction:  $6,641

When I enter the entry of the asset in TurboTax, do I enter the purchase price of $11,641 as the cost and the indicate that I am only taking $6,641 as Section 179 deduction?  If so -- will TurboTax then calculate an annual depreciation amount on the remaining $5,000 in future tax years (i.e. 2021, 2022, etc. -- which would not be appropriate)   OR ----   Do I enter the asset purchase price in TurboTax as only $6,641?

[Anonymous_ · Accepted solution]

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@mquilter wrote:

.....Do I enter the asset purchase price in TurboTax as only $6,641?

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Personally, I would enter that lower figure because the software does not support Form 8826 and a test (that included a transfer from 2019 to 2020) resulted in additional depreciation being calculated for the 2020 tax year when the input for the asset was $11,641 and a partial Section 179 deduction was selected.

So, yes, TurboTax will calculate an annual figure on the remaining $5,000.

There was a similar (actually, virtually the same) question asked last year with respect to a 2019 return being prepared with TurboTax but there was no definitive answer.