Investment Assests Summary - asset that may need adjustment

[HannahBanana]

After doing my Fed tax, I'm running the Cal State review and a screen came up 'Investment Assets Summary' stating there may need to be an adjustment on my State tax.  The description of the asset was 'untitled'.  This has never happened before and following another question on this site, I pulled up the California Asset Entry Worksheet,  and in #4, Type of Asset, it has "A- Computer'.  #40 "Heavy SUV?" the 'No' box is checked.    Nothing else is filled in and I don't know where the date in the 2 blocks came from as it doesn't relate to anything in my 1040 form.  

Where would this data come from on the Federal tax forms?  

[MonikaK1]

It depends. Do you have a Schedule C business or a Schedule E rental property with assets subject to depreciation? If so, the assets need to be identified correctly in TurboTax in order to be assigned to the right asset class for depreciation for both the Federal and California returns. You can revisit those sections of your Federal return and check the asset entries to be sure they are correct.

California law has not always conformed to federal law with regard to depreciation methods, special credits, or accelerated write‑offs. Consequently, the recovery periods and the basis on which the depreciation is calculated may be different from the amounts used for federal purposes.

California law does not conform to the federal law for: 

• IRC Section 168(k) relating to the depreciation deduction for certain assets

• The enhanced IRC Section 179 expensing election. 

• The expanded definition of IRC Section 179 property for certain depreciable tangible personal property related to furnishing lodging and for qualified real property for improvements to nonresidential real property.

 • Federal modifications to amortization of research and experimental expenditures (IRC Section 174).

 Additional differences may occur for the following:

 • Luxury Automobile Depreciation: Sport utility vehicles and minivans built on a truck chassis are included in the definition of trucks and vans when applying the 6,000-pound gross weight limit. However, California does not conform to the federal modifications to depreciation limitations on luxury automobiles (IRC Section 280F).

Any differences between Federal and California deductions are summarized on California Schedule CA.

See the Instructions for FTB Form 3885A for further explanation of the California adjustments to Federal depreciation.

See this TurboTax tips article for more information on depreciation and Section 179 expenses.