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Missed Depreciation F3115

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Level 3

I am back, I filed the extension for the client whom I will be assisting. I understand to capture the missed depreciation on the rental I will use Form 3115 and do the adjustment " sec 481 (a) adjustment" under other expenses. Just have a few questions on the process. 

  1. Am I able to deduct this years normal depreciation form 4562 (for this years depreciation and going forward )& file form 3115 (to capture the missed depreciation) together? I looked and looked for this response but not very clear on the responses as it is not very straight forward.
  2. Also, for completing the form 3115 part I a (DCN) I believe it is (7), are we suppose to just mark X in this section? 
  3. Is there a sample of a completed F3115 for depreciation recapture we can view?

My understanding also once the form is completed, hope I can efile F3115, it as part of the return as I never done so, I then have the tax clients sign the printed form and mail the form to IRS National Office IRS Ogden, UT 84201 M/S 6111.

Asking to make sure I am crossing my I's & T's.

Greatly appreciate any feedback.

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1 Solution

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Level 12

1)  Yes.

2)  Yes, you put "7" on the DCN line.  There is no need for an "X", except to mark the "Depreciation or Amorization" box just above the DCN area.

3)  This link will probably help:  https://portal.clientwhys.com/sites/11009sang/form-3115-line-by-line-current-kj-to-pdf-to-ppt-111017...


Yes, you can attach a PDF to the e-file, and mail the second copy to the address in the Instructions.


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3 Replies 3
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Level 12

1)  Yes.

2)  Yes, you put "7" on the DCN line.  There is no need for an "X", except to mark the "Depreciation or Amorization" box just above the DCN area.

3)  This link will probably help:  https://portal.clientwhys.com/sites/11009sang/form-3115-line-by-line-current-kj-to-pdf-to-ppt-111017...


Yes, you can attach a PDF to the e-file, and mail the second copy to the address in the Instructions.


View solution in original post

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Level 3
Thank you for responding on a Sunday,
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Level 2

I have a similar situation.  Client did a cost segregation study on a building held in a LLC-partnership.  I've got the 3115 done, but I don't know where to enter the catchup depreciation so it will be reflected in the current tax return.  Apparently, the adjustment amount entered on 3115, Q26, doesn't flow into the partnership return and therefore isn't reflected in the K1.  I saw in a different thread that I am supposed to enter this amount on Sched E, which I am assuming was the taxpayer's 1040 Sched E, which seems odd.  But that might be where it is supposed to go.

That's the background.  Where do I enter the catchup depreciation expense so that it is reflected in the net income and/or AGI for the taxpayer?

TIA.

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