PA Depreciation Adjustment

[mrmjenks]

PropertyCost Rate 2025 Depreciation

Sign	$3,650	3.57%	$130.31
Furniture	$2,350	3.57%	$83.90
Laptop	$1,000	5.00%	$50.00

Total 2025 Depreciation

$264.21

assets with MACRS depreciation (200DB with the Mid-Quarter convention). Because over 40% of the assets were placed in service in Q4, the Mid-Quarter rule applies instead of the half-year convention

The Depreciation deduction on the PA return is $132 vs the calculation above of $264.

How do I correct the PA return. It looks like the Turbo Tax calculation is incorrect.

[MelindaS1]

If you're using TurboTax Desktop, select Forms view, under Forms In My Return, select Depr Wkst to see what assumptions the software is using to calculate these assets. You have the first 2 categorized as 7-year property, and the computer as 5-year (seems correct), but your answers to interview questions may have accidentally led to different inputs. 

You may need to manually add the state depreciation worksheet to view it for comparison with the federal; this option will be the first depreciation page on the Forms In My Return list. 

If you're using TurboTax Online, continue to print and view the PDF return as you have been, but select the print option for all TurboTax worksheets to find your federal and state deprecation calculations. You can also search for "4562" in the return PDF to view the assumptions on the Federal depreciation form, if needed.

This doesn't seem to be the issue, but general reminder that a major difference in federal/state depreciation for PA purposes is that bonus depreciation (Special Depreciation Allowance) is disallowed by PA Dept of Revenue.

[mrmjenks]

I spoke with a Turbo Tax rep. This is a Turbo Tax calculation error, and they are aware of it.

They recommend to go to File tab and choose "Remove State Return" and then redo the state return.

If that does not work, they suggest to manually adjust the PA Fed/State depreciation adjustment worksheet.