Schedule C state prior depreciation

[DianneG]

When reviewing I get a pop up screen that is telling me to fill in an entry asking for state prior depreciation on schedule C.  Where can I find this amount?  I have used turbotax for years and I have all prior year tax forms.  

[RobertB4444]

Form 4562 from last year will have the depreciation information.  There is also a schedule at the end of your California return that shows the amount of depreciation taken in 2021 and the amount remaining as well as the accumulated depreciation as of 2021.

@DianneG 

[DianneG]

California?  I'm from Massachusetts.  So 2021 federal form 4562 depreciation amount would be the same as state of Massachusetts depreciation amount?

[AmyC]

Maybe. Thanks for the extra information. MA has a depreciation adjustment when a taxpayer claims bonus depreciation on the federal return.  For the year property is placed in service and subsequent years, a taxpayer must calculate Massachusetts depreciation as if the taxpayer elected not to utilize the bonus depreciation allowance.

You can look on your Form 4562 for Sec 179 or bonus depreciation. For guidance, see Massachusetts Department of Revenue Issues Guidance.

[DianneG]

Hi Amy, thanks for responding.  The truck was placed in service in November 2017.  The link you sent for Massachusetts states after December 31st, 2017.  So I don't think this would apply to me correct?  I have 2021 Form 4562, are you saying that amount would be the same as Massachusetts prior depreciation?

[JamesG1]

The 2021 Form 4562 Depreciation and Amortization Report will report whether special depreciation or section 179 depreciation was taken on the vehicle.

You may have a Car and Truck Expenses Worksheet amongst your 2021 tax forms.

Different Massachusetts depreciation will be recorded under the state section.

@DianneG 

[DianneG]

@JamesG1 

Hi James,

I have all the forms you mentioned.  When I look back at previous years on the car and truck expense worksheets, the state prior depreciation line is blank.  I also have my 2021 form 4562 right in front of me.  Lines 26-28 are filled out.  That amount is then carried to lines 21 and 22.  That same amount is on line 13 of Schedule C.  I am trying to dispose of the vehicle.  I guess I'm not understanding how this all helps me to figure out what amount to put?   Please help.

[RobertB4444]

If the state prior depreciation line is blank then you leave it blank on the form that you're filling out.

@DianneG 

[DianneG]

@RobertB4444 

I can't leave it blank.  A pop up screen comes on and says check this entry.  State prior depreciation must be entered.

[JamesG1]

Sorry, this form 4562 would show if if there were special depreciation or section 179 depreciation deduction which Massachusetts treats differently.

You may be viewing this IRS form 4562.  My apologies.

If there is no report of special depreciation or section 179 depreciation deduction, there likely is no difference between Massachusetts and Federal reporting.

@DianneG 

[sewshelbyjane]

I am having the same issue.  Did you figure it out?

[AmyC]

Thanks for the information. From 2002-2018, there were state adjustments possibly made.  My bet for your truck is the federal and state depreciation will be the same but to be sure, check your federal 2017- when you started taking depreciation - and see if you have an additional bonus depreciation (this includes Sec 179 for other readers).

A Massachusetts taxpayer that claims bonus depreciation for federal purposes must calculate a separate depreciation schedule for purposes of claiming depreciation on the Massachusetts personal income tax return. For the year property is placed in service and subsequent years, a taxpayer must calculate Massachusetts depreciation as if the taxpayer elected not to utilize the bonus depreciation allowance.

There is also a state adjustment for some automobiles. 

Therefore, if your prior year state returns, have no depreciation adjustment, this would not apply to you.

@sewshelbyjane