different property depreciation

[jnaka]

I had my tax return done by my accountant last year and I am doing it myself for the first time this year with Turbotax. 

After input all required information, my property depreciation is different from the record from my last year tax return. I guessed the different is year to fully depreciate while Turbotax is 27.5 years, my accountant used 40 years so the number from Turbotax is $5,174 vs $2,385 from last year record. 

How do I fix this? There is no where to adjust the "year to fully depreciate" in Turbotax.

[Mike9241]

tell us is it US or foreign property and the year placed into service?

over the last 80 years, there have been numerous changes in depreciation lives and methods.  for example, residential real property acquired and placed in service before 3/16/1984 could be depreciated over 15 years now for US property it's 27.5  years straight-line with mid-month convention .however, nothing in the laws allowed you to change from the method used in the year acquired to what new law allows.  at some points, there were even different lives and methods for regular tax purposes and AMT tax purposes. 

if you want to read up on depreciation read pub 946 (2021 version not available at the time of this posting but only minor changes for listed property)

https://www.irs.gov/pub/irs-pdf/p946.pdf 

[jnaka]

Hi, Thanks for your reply. 

It is foreign property in Tokyo, Japan and that year placed into service is 2015.

[MarilynG1]

Foreign property placed in service before 2018 will be depreciated over 40 years. 

Click this link for details on Depreciating Foreign Property. 

[jnaka]

I input Japan as a country of the property and 2015 placed into service but the depreciation life is still 27.5 years. Is there anywhere that I can adjust this number of depreciation ?

[ColeenD3]

Yes, when it asks what the address of the property is, there is a drop-down box that allows you to click "foreign".

[jnaka]

yes, I did that as below. 

[Critter-3]

The online program will default to 27.5 years ... to do this correctly you will need the downloaded version.  

[jnaka]

I am using the download version, Premier 2021, Federal and State returns 

[jnaka]

Hi, thanks all for answering my question. I found another drop down menu for property outside US and got the 40 year depreciation life.

However, the number is still different, $3666 from Turbotax vs $2924 from previous year.

Then I found form 4562 from the previous year tax return done by my accountant and the depreciation amount is in Part III, MACRS Depreciation, Section A, item 17, "MACRS deductions for assets placed in service in tax year beginning before 2020". Is that the reason the number is different? How can I do that? 

Also, I input all my information but don't have form 4562 from my Turbotax, how can I get that form? 

Thanks.

[Critter-3]

You must use all the basis info from the prior year depreciation worksheet and you will not  get a form 4562 unless you place new assets into service.  Switch to the forms mode and look at the depreciation worksheet to see which base amounts are not the same.

[jnaka]

I input all the information but still could not get form 4562. This form 4562 was included in my tax return done by my accountant every year including last year. 

[Critter-3 · Accepted solution]

The 4562 is only printed/generated if required. So long as their are no changes from the prior year, it's not required. Things that will generate it are adding an asset, removing an asset, and selling or otherwise disposing of an asset.

If the 4562 is not required then you will only get the 4562 worksheet for depreciation.  

[jnaka]

Thanks for your answer about 4562. 

About foreign rental property depreciation I have 2 questions as below. 

1. Based on the "depreciation detail listing" form from last year tax return, my accountant used the "basis adjustment" to deduct from the cost of the property and get the "depreciation basis". 

First, I input the cost of the property in Turbotax but got the different amount of depreciation and there is no option to input "basis adjustment" so I changed the number of cost of property and used  the amount from the "depreciation basis" (real cost minus basis adjustment) from last year and got the same depreciation as last year. Can I do this ? The cost shown in the "depreciation detail listing" form will be different from last year then. 

2.  Last year "depreciation detail listing" showed SL MM as a method but what I got from Turbo tax is ALT/MM, how can I changed the method to be the same as last year? 

[SG81_Stefan]

I have the same issue. A 2017 German rental property. I use the TurboTax premium online version.

My tax consultant has been depreciating it as 40y, method = AML, Conv= MM.

Turbotax shows 27.5 years, method = SL, Conv=MM. Hence I get a different depreciation amount.

I have entered it as a property with a foreign country address = Germany, in use as of 10/01/2017.

I discussed it with a live support person from TurboTax but she could not solve it. 

appreciate the input! Stefan