Verified answer

Rental income and expenses are reported on Schedule E, not D.

Even if your AGI is too high to claim the losses, you should still file your Schedule E with your tax return. The losses will carry forward until you have income, or sell the property. When the property is sold, you would have to make an adjustment to basis for depreciation, whether you claimed it or not.

Your accountant is correct. You should still figure your deductions and carry forward any unallowed deductions to future years.

When you sell the property and report the capital gains on Schedule D, you must recapture depreciation allowed or allowable, whether you were able to deduct the depreciation or not. The amount of depreciation recaptured will be taxed as ordinary income. The remainder of the gain will be taxed as capital gains.

You wil also need to file Form 4797 when you sell, to figure which amount is depreciation and which amount goes to Schedule D as capital gain.

your agi is to high to get depreciation deductions? never heard that before...

your deduction reduce the amount of money your taxed on

so how does that have anything to do with how high your agi is?

It should help you out...

you should claim it...

When I had rentals it helped me out alot...

I think the accountant is right, I think they do assume you claimed it.

best to call h & r block or irs just in case.. or claim it..