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Depreciation worksheet

khorshed
Level 3

If depreciation deduction on Sch E will NOT benefit a client, how (if any) to elect NOT to depreciate on the depreciation worksheet?

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TaxGuyBill
Level 15

Taking depreciation is not an optional thing.

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TaxGuyBill
Level 15

Taking depreciation is not an optional thing.

View solution in original post

khorshed
Level 3

Thank you

khorshed
Level 3

You might be tempted to avoid the risk of getting hit with recapture tax and to not claim depreciation. This would be a gigantic mistake. First of all, if you own investment property, you probably pay tax at a rate of 25 percent or more, so paying 25 percent recapture tax still saves you money. Plus, by claiming depreciation, you get money today that you can use and invest, even if you have to pay taxes on it in the future. The real reason to claim depreciation is that the IRS will charge you recapture tax as if you depreciated your property, whether or not you did. Since you're going to pay the bill in the future, you might as well get the benefit today.

abctax55
Level 15

Google or search 'allowed or allowable'.  Bill's correct..all you can do is minimize the current year if possible (i.e. elect out of bonus...)

Former Chump..oops..AllStar...I used to be a people person, then people ruined it


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Accountant-Man
Level 11

There is no such election to NOT depreciate.

** I'm still a champion... of the world! Even without The Lounge.