Can I depreciation in 2018 for an asset placed in service years prior without filing Form 3115?

Forum|Forum|6 years ago
December 7, 2019
2 replies
33 views

I have a new client who never depreciated her rental property. Can I just take this year's depreciation without filing Form 3115 for the prior years and a change in accounting method? The property is now part of her estate and will get a step up anyway so recapture is not an issue. I would like to claim this year's depreciation if the additional form is not required but I honestly do not know.
Thanks for your help.

Lacerte Tax

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Best answer by TaxGuyBill

If depreciation was not claimed for the prior two years, you technically are not allowed to claim the current year depreciation without Form 3115. In reality, the IRS probably would never care if you did.

Does the taxpayer have any taxable income? If so, you would be cheating the taxpayer out of a deduction by not using Form 3115. Form 3115 can be used to 'catch up' on the missed depreciation, thereby lowering the current year taxes.

T

TaxGuyBillAnswer

Level 15

If depreciation was not claimed for the prior two years, you technically are not allowed to claim the current year depreciation without Form 3115. In reality, the IRS probably would never care if you did.

Does the taxpayer have any taxable income? If so, you would be cheating the taxpayer out of a deduction by not using Form 3115. Form 3115 can be used to 'catch up' on the missed depreciation, thereby lowering the current year taxes.

sjrcpa

Level 15

"The property is now part of her estate " Your new client is deceased?

The more I know the more I don’t know.

P

pat11Author

Level 5

Yes, I am working on the final 1040.

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