Unclaimed rental depreciation-Form 3115

As you've already discovered, Form 3115 isn't included in ProSeries. You'll have to download Form 3115 from irs.gov and prepare it separately. You can still efile the return by using Form 8453 and checking the Form 3115 box when you mail the Form 8453 after the return has been accepted. Read the instructions for Form 3115, though, you'll also have to mail a copy of the Form 3115 to the IRS National Office. The address is in the Form 3115 instructions.

Quickfinder, on page 10-20, provides an example of exactly what you're trying to accomplish. Of course, if you don't have a copy of Quickfinder, that information doesn't do you much good. It's a little long for me to try to transcribe here, and it's probably a copyright violation to transcribe it anyway. The gist of it is that on the 2008 Schedule E you'll enter a negative Section 481(a) adjustment to recoup the unclaimed depreciation from prior years, and you'll claim the 2008 depreciation in normal fashion on Form 4562.

(If you don't have Quickfinder or The Taxbook, buy one or both of them today. They're well worth the cost. I order both every year, but you won't go wrong with either one if you only want to purchase one.)

Dittos on the Quickfinder or TaxBook. Absolutely essential, and not all that expensive.

Happy Tax,

Thank you so much ... you saved me hours of research and frustration!

Aisha

Hey guys - I'm dying to know if Form 3115 worked for this exact purpose. The guys at Taxalmanac haven't helped me much with no specifics. I'm trying toi figure out how to use that form - instead of an amended  method. Is missed depr. a method of "non-depr. to depr" or " making a late depreciation method?"  The form gets filled out differently based uppon the answer

In spite of Eileens' success (we do not know the specifics) I do not agree that failure to take depreciation is a "change in accounting method".

There is no "accounting method" that advocates the omission of depreciation.

When I have run into this I have minimized the impact by being more liberal on the land value and amending the previous three years 

The following statement does appear on the form, however, that makes me wonder if the IRS is more liberal then what one may imagine:

6 If the property is not currently treated as depreciable or amortizable property, attach a statement of the facts supporting the proposed change to depreciate or amortize the property.  

I would be curious to hear more details from Eileen...and I think that I would attempt to do this...nothing ventured, nothing gained

 

James, your quote seems to apply to converted property, such as, "My son lived in the house until he could buy one of his own, then we started renting it out."