You really need to know your specific tax situation. It can be confusing.
You can expense it but, you need to enter it as an expense during the expense portion of the interview.
The TT rep did a good job with the walk through.
TT does attempt to make it easier.
The one thing TT does NOT do though is walk you through what is best to do from your specific tax rate situation.
Examples.
High income individuals with losses on rental properties who can not use the losses. There is no benefit of faster depreciation so many prefer slowest depreciation.
Some high income folks would never want quicker depreciation and are better taking slowest depreciation as they can not utilize losses and AMT would not allow quicker depreciation, and their states then also don't allow faster depreciation and they don't want timing difference. Perfect example is NJ does not allow loss carryforwards.
Most individuals will benefit expensing vs. depreciating if they can use the losses only! That is the basic nature of why you would want to expense it. You would want to depreciate if you think you would owe at a higher tax rate in the future though.
Property owners with modified adjusted gross incomes of $100,000 or less may deduct up to $25,000 in rental real estate losses per year if they "actively participate" in the rental activity. You actively participate if you are involved in meaningful management decisions regarding the rental property and have more than a 10% ownership interest in the property. This allowance is phased out for taxpayers whose MAGI exceeds $100,000 and eliminated entirely when it exceeds $150,000. Thus, it is useless for high-income landlords.
**I don't work for TT. Just trying to help. All the best.
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**Mark the post that answers your question by clicking on "Mark as Best Answer" I am NOT an expert and you should confirm with a tax expert.
