More vacation home crap

[joanmcq]

I'm totally fried on this return.  Anyways, depreciation.  On the vacation home worksheet, there are checkboxes I'd the expense is 100% allocable to the rental. Like advertising and management fees. Got that; we get to take them at 100% against the rental up to the income limit.  So we have two columns: expenses disallowed due to ratio, disallowed completely. Then disallowed due to income limit, available for carryover.   Nearly all the dep goes to the latter column without the box checked. If I do check the box, it allows the depreciation in full?  I'm thinking, well there wouldn't be dep if it wasn't a rental?  And then think well, that doesn't seem right that the program is allowing a loss above and beyond income if I do.

i believe I am overthinking and should just leave the damned box unchecked and move on. But then I get a nagging voice saying what if I'm wrong?  I'm way too tired to muddle this through. 

[jklcpa]

First you have to divide the expenses by direct & indirect if there is personal use, and from then on the treatment depends on the amount of personal use. If it is more than the greater of 14 days or 10% of days rented to others, then it is considered as a dwelling unit used as a home. If that is the case, then the expenses divided and attributable to the rental cannot create a loss to offset other income on the return. The expenses up to the amount of income are used and the rest are carried forward, including the depreciation. Iirc, ATX would calc this automatically if the days of personal use and rental were entered, and it would divide the carryovers (if any) and show it as 2 lines, one for vaca exps c/o and the 2nd line for depreciation c/o. 

I hope that I summarized that correctly. Pub 527 if you need to see it directly.

Are you talking about the box specifically for depreciation on the vacation home tab?