Prior Depreciation

Forum|Forum|2 years ago
September 15, 2023
2 replies
21 views

I have a new client that has a rental property since 2014. The property was depreciated properly prior to becoming my client. I am working on the 2021 Return and entered the asset as I usually do - entering the value of the property, the land, the length of time (30 years/commercial property). Up to this point it works fine and calculates the depreciation matching prior Returns. The problem starts when I enter prior depreciation, suddenly the depreciation changes for this year. I need to be able to have it properly calculating, because the building was "exchanged" (Section 1031). I have not even started on the1031 Exchange since the prior depreciation is giving me an issue. What am I overlooking or entering wrong?

ProSeries Professional

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Best answer by TaxGuyBill

@kittieshere wrote:

the length of time (30 years/commercial property).

Do you mean 39 years?

Have you manually calculated the prior depreciation, and if so, does it match what the prior depreciation schedule shows?

I suspect that the "prior depreciation" that you are entering is probably wrong. You can just leave it blank if you want to. Another option is to scroll WAY down on the Asset Entry Worksheet and say "Yes" to using the IRS "Tables".

IRonMaN

Level 15

It sounds like the software doesn't agree that the past depreciation was calculated correctly based on what was entered into the system. Do you have the same month and year loaded in for the placed in service date as the prior depreciation schedules?

Slava Ukraini!

K

kittieshereAuthor

Level 2

Yes, I have the correct date. I looked at the Asset Life History when I enter it without the prior depreciation and it shows the same amounts.

IRonMaN

Level 15

How much is the difference?

As a side note, if you feel the current year amount is not correct, you can always override the current year to what you believe is the correct amount,

Slava Ukraini!

T

TaxGuyBillAnswer

Level 15

@kittieshere wrote:

the length of time (30 years/commercial property).

Do you mean 39 years?

Have you manually calculated the prior depreciation, and if so, does it match what the prior depreciation schedule shows?

I suspect that the "prior depreciation" that you are entering is probably wrong. You can just leave it blank if you want to. Another option is to scroll WAY down on the Asset Entry Worksheet and say "Yes" to using the IRS "Tables".