Question

How do I get TurboTax to expense only the rented portion (67%) of depreciation for my new rental property?

Forum|Forum|5 years ago
March 27, 2021
1 reply
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I purchased a new home in 2020, and I rent out 2/3 (67%) of the house to tenants. TurboTax's calculations have appropriately apportioned all expenses (insurance, mortgage interest, etc.) to show only 67% on Schedule E...except for depreciation expense. TurboTax has applied 100% of the calculated depreciation expense to my rental property rather than only 67%, which leads me to understate my income (showing a loss on rental activities rather than income).

Any advice on how to get this corrected? I don't want to file incorrect returns and have TurboTax incorrectly carry forward a loss on these passive income activities.

TurboTax Premier Online

Carl11_2

Employee

TurboTax has applied 100% of the calculated depreciation expense to my rental property rather than only 67%, which leads me to understate my income (showing a loss on rental activities rather than income).

I'm fairly cetain (More than 90% certain) that I know why, and can help you get this right in the program.

Now I'm using the CD/Desktop version of Turbotax Home & Business. My screen indicates you're using the online version. So my screenshots will be a bit different from what you actually see. However, I hope to "get across" what you need to do.

Work through the asset in the Assets/Depreciation section. YOu'll have a screen that will ask you "Percentage of time I used this item for this business in 2020". That question "should" be "percentage of floor spaced I used in this businses in 2020". So change that percentage to 67%, and let me know if that does the trick. If it does not, then I'll provide you a "step by step". Hopefully, this will save us both that time.