Skip a year of depreciation?

I have a client whose Schedule E wasn't operating for a year.  (The building was inhabited rent-free by a family member for part of the year, unrentable for the rest.  No attempt was made to get a paying tenant.)  Since the business was on hiatus for that year, we can't claim any expenses, including depreciation.

Is there any way to make Lacerte skip a year for depreciation, then pick up where it left off?

I've played with this a little using a sample client and an imaginary 3-year asset.  In the second year I tried entering -1 for current depreciation, and -1 for business percent, and proforma'd each method for a couple of years.  Either way, Lacerte treats year 3 as the final year, taking partial depreciation.  Year 4 has $0 depreciation, as though it were fully depreciated, even though there's a year's worth of basis remaining.  

Entering the asset in year 2 as if for the first time, changing Prior Depreciation to match actual (a year's-worth lower than normal) doesn't solve the problem.

Manually adding a year to the Life doesn't solve the problem, and messes up the dollar amounts.

I'm hoping there's a trick that takes care of the whole thing quickly, similar to skipping a year for claiming a dependent, but that's probably wishful thinking.

The only solution I see is to attach notes instructing the preparer to override the depreciation in each of these assets' next-to-last and last years  (and hope the notes aren't garbled or lost over the next several years).
Any other suggestions are very welcome!

4 additional answers

No answers have been posted

More Actions

People come to Accountants Community for help and answers—we want to let them know that we're here to listen and share our knowledge. We do that with the style and format of our responses. Here are five guidelines:

  1. Keep it conversational. When answering questions, write like you speak. Imagine you're explaining something to a trusted friend, using simple, everyday language. Avoid jargon and technical terms when possible. When no other word will do, explain technical terms in plain English.
  2. Be clear and state the answer right up front. Ask yourself what specific information the person really needs and then provide it. Stick to the topic and avoid unnecessary details. Break information down into a numbered or bulleted list and highlight the most important details in bold.
  3. Be concise. Aim for no more than two short sentences in a paragraph, and try to keep paragraphs to two lines. A wall of text can look intimidating and many won't read it, so break it up. It's okay to link to other resources for more details, but avoid giving answers that contain little more than a link.
  4. Be a good listener. When people post very general questions, take a second to try to understand what they're really looking for. Then, provide a response that guides them to the best possible outcome.
  5. Be encouraging and positive. Look for ways to eliminate uncertainty by anticipating people's concerns. Make it apparent that we really like helping them achieve positive outcomes.

Select a file to attach: