In a LKE, you should depreciate the carryover basis of property acquired over the remaining recovery period of the property exchanged. My question is:
Client began depreciating original property in 1992, which leave 14 years of depreciation. Remaining basis in property prior to exchange was $58,103, but when figuring the carryover basis including the closing costs and exchange costs, my carryover basis is now $121,563.
I input the carryover basis of $121,563 and this is where I am unsure. I am unsure how to input into software so system figures correctly. I input an acquired date of 1/10/92, which was the original acquired date of property so it would depreciate over remaining recovery period of 14 years; however, I have something incorrect because if I multiple the deduction for the year times the remaining 14 years, I am far below the $121,563 basis.
Client began depreciating original property in 1992, which leave 14 years of depreciation. Remaining basis in property prior to exchange was $58,103, but when figuring the carryover basis including the closing costs and exchange costs, my carryover basis is now $121,563.
I input the carryover basis of $121,563 and this is where I am unsure. I am unsure how to input into software so system figures correctly. I input an acquired date of 1/10/92, which was the original acquired date of property so it would depreciate over remaining recovery period of 14 years; however, I have something incorrect because if I multiple the deduction for the year times the remaining 14 years, I am far below the $121,563 basis.
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