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2017 depreciation correction

If land not separated in a rental prop purchase in 2017 on depreciation schedule, is form 3115 or amend return needed?

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5 Replies

2017 depreciation correction

 
tax luck
New Member

2017 depreciation correction

The depreciation on Schedule E Line 18 was auto entered and is not correct.  How do I correct it?

MarilynG
Expert Alumni

2017 depreciation correction

Depreciation is calculated using the Cost Basis of the Rental Property, and the date you started renting it.  If you feel the Depreciation TurboTax has calculated for you on Schedule E is not correct, go back and check your rental property entry in the Assets/Depreciation section to be sure it is correct. 

 

Here's more detailed information on Rental Depreciation to help you.

 

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Carl
Level 15

2017 depreciation correction

This usually happens when folks don't interpret the asset entry screen correctly.

COST - This is where you enter the amount you paid "in total" for everything. Land and structure.

COST OF LAND - This where where you enter the amount paid for the land which is included in the above COST box.

The program (not you) will then do the math to subtract the cost of the land from the cost, and the difference is the cost of the structure. That difference is what gets depreciated. So if you did not enter anything for cost of land, or entered a zero there, then as you've discovered, you're talking more depreciation than you're entitled to.

If this started with a 2017 return or later, then you can just amend the 2017 return to fix this. Of course, that means you'll have to amend the 2018 return also and you will "NOT" be able to import your corrections from the amended 2017 return. You'll have to manually enter the correct amounts for prior depreciation youself, on the 2018 return.

Then from that point when you start your 2019 return you can import the correct numbers from the .tax2018 file that will be physically on your computer's hard drive - not from your online 2018 tax file.

 

2017 depreciation correction

 

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