Where to enter depreciation for primary residence sold

[nothingsknower]

Hello,

In 2023, I sold my primary residence that I owned since 2007. It was used as my primary residence until February 2018 when I rented it out. I then moved back into it as my primary residence in May 2020.

Between February 2018 and April 2020, I claimed depreciation on it for those tax years.

Now that I've sold the home, I'm trying to see where I should enter this depreciation... and I'm a bit confused because it seems to be asking for it twice in different locations.

First, I see a screen "Tell us about the Purchase of your home" where I enter the "adjusted cost basis". The support in the software says "depreciation claimed or allowed" is part of this number. Does this mean the depreciation I claimed for it while I rented it is entered here? if so, is it entered as a positive number that increases my cost basis or a negative number that reduces it? 

Secondly, there is another screen "Depreciation after May 6, 1997" with a line where I can enter depreciation.

Can I get some clarification if I should be entering/factoring in the depreciation I claimed when I rented the home in both of the above screens or just one of them? (and if the first screen, if it increases or decreases the adjusted cost basis).

Thank you for the help. 

[PatriciaV · Accepted solution]

Yes, you should enter your prior depreciation when you set up the sale of your home in TurboTax. Depreciation reduces your basis in the property.

The second question about depreciation after May 6, 1997, is part of the calculation of taxable gain. If you were entitled to take depreciation deductions because you used your home for business purposes or as rental property, you cannot exclude the part of your gain equal to any depreciation allowed or allowable as a deduction for periods after May 6, 1997. In other words, you will pay taxes on this amount because you previously took the deduction.

Unless you are instructed to enter a negative number, all entries in TurboTax are positive numbers. Take note of any blue links (such as "Learn More") on entry screens - these provide more information and instructions for that topic.