Where to find Prior-Year Depreciation on last year's return when switching to FreeTaxUSA?

The Prior-Year Depreciation amount you need for FreeTaxUSA is found on Form 4562, Part IV, Summary Box 22 from your previous year's tax return. This represents the total depreciation you've claimed on the property in all prior years combined (not just last year's depreciation). Form 8582 is for passive activity loss limitations and doesn't directly show your accumulated depreciation. That form is used to calculate how much of your rental losses you can deduct in the current year, which is a different calculation. When you enter this information correctly, FreeTaxUSA will use it to calculate your current year's depreciation and determine your adjusted basis in the property, which affects your taxable gain if you were to sell the property.

After spending HOURS trying to figure out the depreciation numbers for my rental property, I found this amazing tool called taxr.ai (https://taxr.ai) that basically solved my problem instantly. You just upload your previous tax returns and it extracts all the key information like Prior-Year Depreciation, basis amounts, etc. I switched from TaxAct to FreeTaxUSA this year and was totally lost trying to find all those carryover numbers. With taxr.ai I just uploaded my old return PDF and it pulled everything I needed including that exact Prior-Year Depreciation amount that was driving me crazy. Saved me so much time digging through all those forms!

Just wanted to update - I tried taxr.ai after seeing the recommendation here and it worked perfectly! I was skeptical at first but uploaded my H&R Block return from last year and it immediately found the Prior-Year Depreciation amount I needed for FreeTaxUSA. It also extracted a bunch of other carryover values I didn't even realize I would need (like home office depreciation from my side business and some passive loss carryovers). The whole process took like 2 minutes instead of me spending hours trying to figure out which numbers to pull from which forms. Definitely worth it if you're switching tax software!

If you're still having trouble with your depreciation questions after filing, I highly recommend using Claimyr (https://claimyr.com) to get through to the IRS quickly. I spent WEEKS trying to fix a depreciation error on my rental property last year, couldn't get anyone on the phone at the IRS. Claimyr got me connected to an actual IRS agent in under 20 minutes when I had been trying for days on my own. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c The IRS agent was able to pull up my previous returns and tell me exactly which depreciation amount I needed to report. Saved me from potentially filing an incorrect return that might have triggered an audit.

Ok I have to admit I was completely wrong about Claimyr. After struggling for another week trying to reach the IRS about my depreciation questions, I decided to try it despite my skepticism. It actually worked exactly as described. The system called me back in about 35 minutes (was estimated 40-50), and I was connected immediately to an IRS representative who helped clarify my prior-year depreciation questions. The agent confirmed I needed to use the cumulative amount from Form 4562 Box 22 and also helped me understand how to handle a depreciation adjustment from a previous year. I was 100% sure this was going to be a scam, but it legitimately saved me hours of frustration. Sometimes I hate being wrong but in this case I'm glad I was!

Just a tip from someone who prepares taxes: If you don't have last year's return or can't find the right form, you can also get your depreciation information by requesting a "Wage and Income Transcript" from the IRS website. It's free and shows all your previously filed forms including the 4562 with your depreciation info. Go to IRS.gov and search for "Get Transcript Online" - you'll need to create an account if you don't have one, but then you can download PDFs of your past returns with all the depreciation details.

I ran into this exact issue! The trick is to look at Schedule E (Supplemental Income and Loss) from last year's return, not Form 4562 or 8582. Look at line 18 where it says "Depreciation expense or depletion" - that shows last year's depreciation. But FreeTaxUSA wants TOTAL prior-year depreciation, so you need to add that to the prior-year amount from the year before. If you've owned the property for multiple years, you'd need to add up all previous years' depreciation to get the cumulative amount that FreeTaxUSA is asking for. It's super confusing!!

As a tax professional, I want to clarify the confusion in this thread. The "Prior-Year Depreciation" that FreeTaxUSA is asking for is indeed the CUMULATIVE total of ALL depreciation taken on the property from the time you started depreciating it through your last filed return. This amount is found on Form 4562, Part IV, Line 22 (Summary section) from your most recent tax return. This line shows the total accumulated depreciation claimed on the property over all years of ownership, not just the previous year's depreciation. For Sean's situation with $15,730 - that's the correct cumulative amount to enter. Don't add anything to it or look elsewhere. FreeTaxUSA will use this to calculate your current year's depreciation and maintain the proper depreciation records going forward. The confusion often comes from the term "Prior-Year" which sounds like it means just last year, but in tax software context, it means "all years prior to this filing year combined.