If you are certain that the missing asset should have been depreciated, you will need to amend your prior year returns to report the missing depreciation. Unfortunately, the IRS does not allow you to "catch up" depreciation in a later tax year.
From IRS Pub 946 "How Do You Correct Depreciation Deductions?":
You can file an amended return to correct the amount of depreciation claimed for any property in any of the following situations.
- You claimed the incorrect amount because of a mathematical error made in any year.
- You claimed the incorrect amount because of a posting error made in any year.
- You have not adopted a method of accounting for property placed in service by you in tax years ending after December 29, 2003.
- You claimed the incorrect amount on property placed in service by you in tax years ending before December 30, 2003.
When to file. If an amended return is allowed, you must file it by the later of the following.
- 3 years from the date you filed your original return for the year in which you did not deduct the correct amount. A return filed before an unextended due date is considered filed on that due date.
- 2 years from the time you paid your tax for that year.
Amend the oldest return first, then amend last year.
You can either file an extension for your current year return, or calculate the depreciation that should have been taken so you can add that asset and complete this year's return.
In either case, you may benefit from the assistance of a local tax expert in preparing the amended returns, since your previous tax preparer is no longer in business.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
