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prior years depreciation

regina
Level 1

May I take prior years depreciation in 2018  I completed a Schdule 2 but did not include Asset  entry.

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1 Comment 1
Intuit_Devin
Employee
Employee

No.

You may only deduct depreciation for the current tax year. If you failed to take depreciation in prior years, you'll typically need to file Form 3115 for a change in accounting methods. The depreciation you should have taken in the prior years can generally be deducted in the current tax year as a 481(a) adjustment.

If last year was the first year property should have been depreciated, and you haven't yet filed this year's return, then you may amend last year's return to claim the depreciation that was omitted. (See https://www.irs.gov/irm/part4/irm_04-011-006:
"a taxpayer filing its first return using an improper method of accounting may change to a proper method by the filing of an amended return. The taxpayer MUST file the amended return prior to the filing of the next year's return. See Rev. Rul. 72-491, 1972-2 C.B. 104.")

Outside of that narrow exception, however, you generally must file Form 3115 and make a 481(a) adjustment to recover depreciation that was mistakenly omitted in prior years.

 

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