For a Trust (using Turbo Tax Business) Real Estate Depreciation

[jeffm]

I am using Turbo Tax Business for a Trust.  For a Rental property, I am figuring about $15,000 of depreciation for the current year. But since my expenses are low,  I can't use all the depreciation.  The depreciation seems to be distributed on the K1 and not kept for the Trust.  If I had more expenses (Like loan interest payments) would the depreciation be used to offset the added expenses instead of being distributed on the Trust K1?

[tagteam]

It is most common for the depreciation deduction to follow the income generated by the asset.

[Mike9241]

For a trust, the depreciation deduction is apportioned between the income beneficiaries and the trust on the basis of the trust income allocable to each, unless the governing instrument (or local law) requires or permits the trustee to maintain a depreciation reserve. If the trustee is required to maintain a reserve, the deduction is first allocated to the trust, up to the amount of the reserve. Any excess is allocated among the income beneficiaries and the trust in the same manner as the trust's accounting income. See Regulations section 1.167(h)-1(b).