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@puravidapto wrote:

Someone may say that since 2k is carried over, so it is sort of allowed. I can buy this,

but when the home is sold, the carryover amount is not used in the end, the accumulated depreciation is still not adjusted.

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As long as a carryover exists, the program is doing it correctly. 

You are right that it should be adjusted when the carryover no longer exists. 

However, there is some debate on whether Vacation Home losses disappear upon the sale, or if they can be used when it is sold (similar to the Passive Loss rules).  I suspect that is why the program doesn't do anything to it upon the sale - it lets you decide what to do with it.