I am using ProSeries Basic and I am trying to depreciate the same vehicle on two separate businesses. Quick background: A client had one business that he bought a truck for and closed that business in June 2021. He turned around and used that truck in an unrelated business in July. I understand that I should use the remaining basis the truck had in the old business as the new basis in the new business. It looks like the only way I can prevent the software from using full year of depreciation on the old business is by entering a disposal date of 7/1/2021 when it began being used on the new business. Are there any potential pitfalls to this solution?
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You've got 2 businesses, each with a short year. Does the software have input for short year calculations?
As far as I can tell there is no way to shorten the business year on the software I am using (Proseries Basic).
The way I read it, it seems questionable if this vehicle was really taken out of service by the taxpayer. It seems to have just switched Schedule Cs.
*IF* that is the case, I would (1) leave the truck on the first Schedule C, (2) manually override the depreciation amount on that Schedule C to reflect a partial year, (3) manually override the depreciation on the second Schedule C to reflect the other partial year, and (4) make notes to switch the vehicle to the second Schedule C for next year (using the original "placed in service" date).
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