Form 3115 Change in Account Method - Depreciation not taken since inheritance in 1989

Forum|Forum|4 years ago
April 3, 2022
1 reply
9 views

Taxpayers inherited a commercial property in 1985. NO depreciation was ever taken by the owners.

Depreciation on a commercial property was over 31.5 years back then.

This means the property (structure portion of course) would have been fully depreciated by now. Would this fact be an issue in filing Form 3115 - that the change would yield a depreciation change of 100% (of the applicable basis) in one year?

Lacerte Tax

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T

TaxGuyBill

Level 15

It doesn't change anything. You can still 'catch up' on the missed depreciation with 3115.

IRonMaN

Level 15

Tax planning tip #1,021,456.2:

Never take depreciation on real property. Just wait and use form 3115 to reduce the effect of the depreciation recapture in the year of sale 🤔 🤔

Slava Ukraini!

joshuabarksatlcsAuthor

Level 9

thanks @TaxGuyBill . That's logical. I was haunted by the fear of "in case I missed something out there." There has to be a phobia word for that.

@IRonMaN Consider changing that to Tax planning tip $1,021,456.20.

I come here for kudos and IRonMaN's jokes.

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