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Common questions on Form 4255 in ProConnect Tax

SOLVEDby IntuitUpdated July 18, 2023

Below, you'll find information about Form 4255, Recapture of Investment Credit, in ProConnect.

Refer to the IRS Instructions for Form 4255 for more information.

How do I generate Form 4255 in the program?

This asset can be entered under either Dispositions or Depreciation.

To generate Form 4255 on the Dispositions screen:

  1. Go to Input Return Income Dispositions.
  2. Select the Details button for the asset.
  3. Make sure that any basis and sale details are already entered.
  4. Scroll down to the ITC Recapture (4255) section.
  5. Enter the Original cost or basis from Form 3468 field.
  6. Enter the Original credit from Form 3468 field.

To generate Form 4255 on the Depreciation screen:

  1. Go to Input Return Deductions Depreciation.
  2. Select the Details button for the asset.
  3. Make sure that the basis and sale details are already entered.
  4. Scroll down to the Asset Information section.
  5. Enter the original credit amount in Basis reduction (amortizable costs expensed, ITC, etc.).
  6. Scroll down to the General Disposition Information section.
  7. Enter the Date sold, disposed, or retired (MANDATORY).
  8. Scroll down to the Sale of Asset (4797/6252) section.
  9. Enter the Sales price (-1=none).
  10. Scroll down to the ITC Recapture (4255) section.
  11. Mark the checkbox labeled Recapture ITC.
 

The program will only generate Form 4255 when the Date sold is less than five years after the date the asset was acquired or placed in service. See the IRS Instructions for Form 4255 for more details about the recapture period.

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