BB1
Visitor II

DEPRECIATION

We have 3 properties as rental since 1988  We moved them to LLC partnership in 2006.  Here is what has transpired since then:

 

  1. We filled the FINAL Tax return on 2015 for the LLc
  2. Only one property has any income/expenses in 2016 nor 2017. Other two we did not have any income/expenses so we did not take any depreciation for 2016 and 2017 tax returns
  3. We are going to have income/Expenses in 2018
  4. We have the Income/Expenses and depreciation information of all three properties on QuickBook 2016 Premier Accountant software.
  5. We are using TurboTax Business for another LLC and TurboTax Premier for personal this year.
  6. Since we already have all the income/Expenses and Depreciation schedule on QuickBoook 2016
  7. How do I handle the depreciations for the other two properties in 2018? Continue with original calculations and depreciate from where we left off after 2015 Or continue to take depreciation for 2016 and 2017?
5 Comments
TurboTax Specialist

DEPRECIATION

Did the titles on the properties change to new ownership when the LLC was dissolved? If so, are the current owners the same as the owners of the LLC?

 

Where all the properties used as Rentals since the LLC dissolved? If not, were they used as personal residences or left vacant?

 

For any properties that were used as Rentals, how did you report the rental activity since the LLC dissolved?

BB1
Visitor II

DEPRECIATION

Thank you for your quick response.  Here are the answers:

 

Did the titles on the properties change to new ownership when the LLC was dissolved? If so, are the current owners the same as the owners of the LLC?    The FINAL TAX return was filled for 2015 year.               The LLC was not dissolved.  It is 1065 form return and passed the profit/loss to us.  The owners are the same; we, for LLC and personal tax. We received K1 form for each and every year for LLC.

 

Where all the properties used as Rentals since the LLC dissolved? If not, were they used as personal residences or left vacant?                          Only one property was a rental out of three properties in 2017.  We filled it under our personal tax.   We started a new depreciation schedule for the rental property using the remaining value of the building for 27.5 years.  We claimed the depreciation in 2016.    Other properties were not rented and were left vacant and we claimed as personal properties and did not claim depreciation.  Remaining of the two vacant property is now rented in 2018 tax year.  So, we have two properties are rented.  The third property was razed and no building on it.  I am using 2017 Turbo Tax Premier.  My question is   how do I claim depreciation for all my properties for 2016?  Also, did I do correct deprecation for the property which was rented in 2017?  If it was not done correctly, how do I fix the depreciation for the rented property in 2017?

 

For any properties that were used as Rentals, how did you report the rental activity since the LLC dissolved?     Please see my explanation on previous paragraph

 

Thank you for your help..

 

TurboTax Specialist

DEPRECIATION

Thanks for the additional information.

 

First, you'll need to set up new properties on your personal tax return for any that were held by the LLC and whose activity was reported to you on Schedule K-1. When you took control of the properties from the LLC, the basis (including accumulated depreciation) was passed to you as well. Therefore, continue to depreciate those properties as you did for the LLC. If you've already done that for 2016, then your 2016 tax return was correct.

 

For 2017, add any rentals that were placed into service during the year. You will begin taking depreciation as of the date you first made the property available to be rented. If this is how you reported the new rental properties, then your 2017 tax return is correct.

 

There is no depreciation deduction for properties that are not being used as as rental or commercial properties.

 

As a point of information, the only way to correct depreciation from a prior year is to file an amended return.

 

 

BB1
Visitor II

DEPRECIATION

Thank you for your quick response.  I have only four questions:

 

  1. Will I be able to use 2017 TurboTax Premier for more than one property as assets and how do I do that?
  2. Will I be able to use 2017 TurboTax Premier for bring back my property depreciation for the properties that were placed before I start using 2017 TurboTax Premier?
  3. Will I be able to use 2017 TurboTax Premier for amending 2016 personal taxes?
  4. For your information, I have 2017 Turbo Tax Business that I use for my other business.  Will it be beneficial to use this software for my personal taxes and/or keeping my personal property depreciation on my Business software?

Thank you, again.

TurboTax Specialist

DEPRECIATION

Yes, you can use TurboTax Premier to enter as many properties and assets as you need to report, under as many Rental Properties and/or Businesses that you own as an individual.

 

You may enter your prior depreciation (the accumulated depreciation total) when you set up your assets/properties. However, if you did not claim depreciation for a prior year, you would need to amend your prior returns to take that deduction. There is no way to "catch-up" depreciation on your current return.

 

Because tax laws change every year, each version of TurboTax is specific for one tax year. To amend a prior year return, you will need to purchase and install the desktop version of TurboTax for that year.

 

TurboTax Business is specifically programmed for business returns only. You cannot prepare a personal tax return (Form 1040) in TurboTax Business.

 

Additional Information