depreciation straight line calculates entire year instead of period used

[Good-Golden]

the straight-line depreciation calculates the entire year, instead of the period used: laptop bought 09/12/2019, using 3 years straight line, should be $173

1. Tell Us About This Asset: input Description; date of purchase (9/12/19); 100% business use

2. Describe This Asset: Other

3. Tell Us a Little More: Other Asset Type

4. How Much Did This Asset Cost: 1,556

5. Type Z, Other Asset

6. How Do You Want to Deduct this Item: Spread the deduction over several years

7. Is This Listed Property: Yes (confirming the computer input earlier)

8. Enter Asset Type and Class: Depreciation Type: Non-recovery property; Asset: 3 year

9. Choose a Depreciation Method: Straight Line

10. Enter Recovery Period: 3

11. Depreciation Amount in 2019: $0

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If I change my response:

8. Enter Asset Type and Class: Depreciation Type: No Entry; Asset: 3 year

9. Choose a Depreciation Method: SKIPPED

10. Enter Recovery Period: SKIPPED

11. Depreciation Amount in 2019: $519

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I have tried different combinations but the result is either $519 or $0. Is this a bug with how TurboTax calculates depreciation using straight-line. I understand that the default is MACRS.

Please HELP!!!

[Carl]

Is this for an S-Corp? Or Partnership?

WHen I work it through a 1065 return and properly classify it as computer equipment, I get a first year depreciation of $311. What worksheet are you using to figure $173 and where can I find it on the Internet?

[GabiU]

I would like to take a deeper look at this, however, I need a diagnostic file-- a copy of your tax return that has all of your personal information removed. You can send one to us by following the directions below for TurboTax Desktop:
1. Click into your return.
2. Click Online and select "Send Tax File to Agent". (When using a Mac, the option is under the Help menu.)
3. This will generate a message that a diagnostic copy will be created. Click on OK, the tax file gets sanitized and transmitted to us.

Please provide the Token Number that was generated onto a response to this thread. 

[Good-Golden]

This is a C-Corp.  I simply used Turbotax Business (downloaded version, 2019) and performed the steps I outlined.   $1556 using 3 year straight-line works out to be $43 per month.  Sep-Oct-Nov-Dec 2019 is $172.92.  $311 is the straight-line 5-year depreciation for entire year.  Why is Turbotax not calculating for the months used?

[AmeliesUncle]

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@Good-Golden wrote:

This is a C-Corp.  I simply used Turbotax Business (downloaded version, 2019) and performed the steps I outlined.   $1556 using 3 year straight-line works out to be $43 per month.  Sep-Oct-Nov-Dec 2019 is $172.92.  $311 is the straight-line 5-year depreciation for entire year.  Why is Turbotax not calculating for the months used?

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A computer uses 5 years, not 3 years.  You need to use 5 years.

The depreciation is not monthly.  You most likely are required to use the 1/2-year convention, which means the first year gets 1/2 a year of depreciation (if you placed more assets in service Oct-Dec, that MIGHT change things).

So a $1556 computer depreciated over 5 years should give you about $156 the first year.

[Good-Golden]

AmeliesUncle, the company has been using 3 year-straight-line depreciation for all computers.  If we want to use 3 years, how do we do that?  I have done the steps to enter the depreciation type and recovery period manually -- it does not calculate correctly.  I have read about overriding and using the FORMS.  What is your advise?

[AmeliesUncle]

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@Good-Golden wrote:

AmeliesUncle, the company has been using 3 year-straight-line depreciation for all computers.  If we want to use 3 years, how do we do that?  I have done the steps to enter the depreciation type and recovery period manually -- it does not calculate correctly.  I have read about overriding and using the FORMS.  What is your advise?

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You are not allowed to use 3 years for computers.  It is not an option to use 3 years, and you MUST use 5 years.

Don't override.  Once you change it to 5 years, you SHOULD be able to enter the information correctly to get the proper amount.  For "Depreciation Type" you need to enter "MACRS".  It should give you $156 for depreciation.