FreeTaxUSA keeps messing up my Schedule E Depreciation calculations - need alternatives!

I'm at my wit's end with FreeTaxUSA this year. I've been trying to properly enter my rental property information, but the Schedule E depreciation calculation is completely broken. No matter what I do, I can't get the numbers to come out right on Line 18 of Schedule E. What's worse is that I can't even manually override the number to enter the correct depreciation amount! I've used an Excel-based 1040 template for the past 8 years which has always worked perfectly since you can see exactly how the numbers flow between different forms. Just tried FreeTaxUSA to save some money but this is making me regret that decision. Anyone else having similar problems? I know the IRS Direct File system lets you manually enter everything, but the deadline to e-file through that system if your AGI is over $108k has already passed for those of us on extensions. Really frustrated and running out of options here.

0 coins

18 comments

Zara Malik

•8M

You're running into one of the common limitations with some of the budget tax software options. Schedule E depreciation calculations can get complex, especially if you have multiple properties or have made improvements that need to be depreciated separately from the main property. When tax software doesn't allow manual overrides for calculated fields, it's usually because they're trying to ensure consistency across the return, but it can be frustrating when their calculation method doesn't match what you need. Your Excel-based approach is actually quite smart because it gives you full control. For software alternatives, you might consider TaxAct or TaxSlayer which both handle Schedule E better than FreeTaxUSA in my experience and still allow some manual adjustments. Another option is to prepare your Schedule E separately (using your Excel template) and attach it as a PDF if you e-file the rest of your return through another system. Just make sure you reference the attachment properly.

0 coins

Zara Malik

•8M

TaxAct does provide more manual control over depreciation entries, especially if you use their higher-tier versions. You can typically override their calculated values by entering your own depreciation worksheet information. They also have decent categorization options for separating improvements (which must be depreciated) from repairs (which can be expensed immediately). If you're dealing with complex property situations, the paid versions of TaxAct or TaxSlayer tend to be worth the investment compared to the frustration of fighting with more restrictive software.

0 coins

Nia Thompson

•8M

After dealing with similar frustrations with tax software limitations, I started using https://taxr.ai for my rental property taxes. What I love about it is that you can upload all your property documentation, and it automatically extracts the relevant tax information including proper depreciation calculations for Schedule E. The real game-changer for me was how it handled my mixed-use property - it correctly separated personal use from rental use and calculated the appropriate depreciation. The best part is that you can actually override any values if needed, unlike FreeTaxUSA which locks you into their calculations.

0 coins

Nia Thompson

•8M

It handles multiple properties very well by creating separate property profiles for each one. You can set up different depreciation schedules for each property, and it will track them independently. For your renovation, you can categorize it as a capital improvement with its own depreciation schedule. The system does know the difference between residential (27.5 years) and commercial (39 years) properties and applies the correct depreciation schedule based on property type. It also distinguishes between Section 179 direct expenses and regular depreciation. What impressed me was that it even flagged some items I had miscategorized that would have caused issues with the IRS.

0 coins

Mateo Rodriguez

•8M

Just wanted to follow up about my experience with taxr.ai that was mentioned above. I was dealing with exactly the same Schedule E depreciation issues in FreeTaxUSA and was at my wit's end. I decided to give taxr.ai a try, and it worked amazingly well for my multiple rental properties. I uploaded my property documents, and it created separate depreciation schedules for each of my three rentals. It even properly set up a distinct depreciation timeline for the bathroom renovation I did last year. The interface let me review and adjust each calculation, which gave me total confidence in the numbers. My return has already been accepted by the IRS with no issues!

0 coins

GalacticGladiator

•8M

If your main issue is getting someone at the IRS to help with Schedule E depreciation questions, I found a service that's been a lifesaver when dealing with complex tax situations. I spent HOURS on hold with the IRS trying to get clarity on some depreciation rules for my rental, then tried https://claimyr.com and they got me connected to an actual IRS agent in about 15 minutes. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I was able to confirm directly with the IRS that my depreciation calculations were correct and got guidance on how to properly document everything. Much better than guessing or trusting possibly incorrect software calculations.

0 coins

GalacticGladiator

•8M

The service uses an automated system that navigates the IRS phone tree and waits on hold for you. When an actual IRS agent picks up, you get a call connecting you directly to that agent. It basically does the tedious waiting part for you. It really does work! The technology handles all the navigation through the phone system, including responding to prompts and waiting on hold. I was skeptical too until I tried it and got connected to an IRS agent who answered all my Schedule E depreciation questions in detail.

0 coins

Aisha Hussain

•8M

I have to admit I was completely wrong about Claimyr. After dismissing it as impossible, I was still stuck with my Schedule E depreciation questions and decided I had nothing to lose by trying it. To my shock, I got a call back with an actual IRS agent on the line in about 20 minutes. The agent walked me through exactly how to handle depreciation for my property improvements and even explained how to document everything properly in case of an audit. Saved me hours of frustration and potentially expensive mistakes. Sometimes being proven wrong is actually a good thing!

0 coins

Yuki Yamamoto

•8M

Yes, TurboTax Home & Business is more expensive (usually around $120, sometimes more with state filing), but the difference is significant if you have rental properties. The depreciation handling alone saves me hours of frustration. The main advantage is that it gives you full control over depreciation schedules, allows you to properly categorize improvements vs. repairs, and lets you override calculations when needed. It also walks you through potential rental deductions you might miss with cheaper software. For me, the time saved and potential tax savings make it worth the higher price.

0 coins