RE trade or business election out of 163j ADS depreciation not calculating correctly

[BradT]

Lacerte's in software depreciation schedule can't seem to correctly calculate depreciation when making the 163(J)(7) election. I have checked the ADS box in depreciation screen - additional information (this does nothing besides entering new assets into the wrong ADS line on form 4562). Also checked the "apply switch to ADS for prior year asset" box which reduces the depreciable basis by the previous 27.5 method and populates the incorrect amount. for the remainder of the years. It is off by about $1,600 a year. This number does not seem like much in any given year, but ends up pushing over $36K to the final year. Most of the limited investors in the property will be gone before the property is sold with the inflated basis and will not be allocated depreciation that they are entitled to. Has anyone received a response from Lacerte as to why their depreciation software cannot correctly calculate depreciation?

[brent]

One thing I did notice, if an asset does not already have a MACRS S/L depreciation method, the automatic switch to ADS will not work.  Some Tenant Improvements had been input as 15 year 150% DDB (§1245) property and  checking the "Apply switch to ADS for prior year asset" box on depreciation input screen 14 had no effect.  I had to select depreciation method 67, "MACRS 15-year SL Improvements," and then it worked.

Otherwise, I did not have any trouble with it.  I only checked the "Apply switch to ADS for prior year asset" box and made no other changes.  Lacerte automatically switched to the ADS life and correctly calculated the remaining SL depreciation.  I prepared an Excel spreadsheet with my own calculations for SL recovery of the adjusted tax basis over the remaining ADS life and Lacerte is within $2 on all but one asset, and that one is still within a fraction of 1 percent on a 3.2 million dollar asset.