Rental real estate depreciation and AMT depreciation is different - how to fix in TT desktop

[Shivamon]

Hi all,

New to TT Desktop H&B this year so appreciate the help. 

I have a rental property overseas was purchased and put into service on December 6, 1996. Rented out 100% each year. My accountant has been preparing my return for the past 10 years until he retired. After reviewing my return for the past 2 years in detail, doing it myself in 2024. The rental was elected to use the ADS method in year 1 and has been depreciating using that following a 40 year useful life and MM convention. Was entering in my 2023 info to see how TT works and in most cases it is correct. When I enter in a basis of $76,501, the depreciation for the year should be $1,913. On my depreciation report for this asset, it calculates depreciation of $4,615 but the AMT report has the correct depreciation of $1,913. It should be the same as both are using the Alternate method with MM convention and UL of 40.  Why is the depreciation report and AMT report depreciation different?  What do I need to adjust in the asset worksheet to get this to be the same being $1,913. 

Thanks

[DianeW777]

It depends. If you did not select that the property was outside the country then TurboTax may not know the correct depreciation method. Once this is selected both the regular and AMT depreciation will be the same.

There’s a 'Foreign Country' field to check about three screens in, where you’re describing the property. The program then knows it’s foreign and sorts out the extended depreciation recovery period.

This is correct: The rental was elected to use the ADS method in year 1 and has been depreciating using that following a 40 year useful life and MM convention. 

•  Any property placed in service before 2018 will use the 40 year recovery period.

[Shivamon]

Thanks DianeW777

On the "Is this a Rental Property or Royalty" screen where I add the property description, location has the foreign country check box selected and the Nature of Foreign Country has been populated. 

Given some software updates, regular depreciation is still correct. AMT depreciation is now blank. I re-filled in the AMT period and basis which is now showing but there is no depreciation charge being shown on the AMT report. I will play around with it unless you know of something that I am missing.

Thanks

[DianeW777]

I'm not aware of anything you might be missing. The regular Schedule E depreciation and the AMT depreciation should be the same. You are not taking regular depreciation at an accelerated rate which is the reason they should both be the same. 

@Shivamon