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The Form 8829 instructions state improvements placed in service (shown on Form 8829 Expenses for Business Use of Your Home during the current year) need to be reported on Form 4562 Depreciation and Amortization for the first year only. The TaxAct program will automatically create this Form 4562 if the date of the improvement entered on Form 8829 is in the current tax year.

TaxAct® supports only one addition/improvement for Federal Form 8829. If you have more than one addition/improvement, you can still file your return with TaxAct, however you will need to file a paper return. Instructions to accomplish this are outlined below.

Note. If you print Form 8829, Form 4562 will also print.

  1. Print a copy of Form 8829 that is showing the original improvement listed. This form is needed for the information to be entered in the final steps. However, this Form 8829 will not be filed.
  2. You will want to create and print a Form 4562 for the current year improvement. The IRS Instructions for Form 8829 list the depreciation rates for improvements placed in service in the current year and the Form 4562 created will accurately reflect the correct rate.
    To enter the information to print Form 4562 for the improvement for the current year:
    1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
    2. Click Business Income in the Federal Quick Q&A Topics menu to expand, then click Business income or loss from a sole proprietorship.
    3. Click + Add Schedule C to create a new copy of the form or click Edit to review a form already created.
    4. Continue with the interview process to enter all of the appropriate information.
    5. On the screen titled Great! Let's get started on expenses for ..., click Enter expenses.
    6. On the screen titled Did you use your home for business purposes for this business?, click Yes.
    7. On the screen titled Business Use of Home - Method, select Simplified Option, then click Continue.
    8. On the screen titled Business Use of Home - Addition or Improvement, enter the cost or other basis of the addition or improvement made in the current year and use the current year for the Date addition or improvement placed in service.
    9. On the screen titled Business Use of Home - Depreciation Adjustment, the program will calculate that amount.
    10. On the screen titled Business Use of Home - Computation, the program will print the correct text.
  3. Print a copy of Form 8829 (and Form 4562) at this time. This Form 4562 will be filed with the return, however, this Form 8829 should not be filed with the return.
  4. You would go back and enter the total cost of both improvements (prior year and current year). Enter the business basis of both improvements on Form 8829 as one total.
    To enter the information to calculate the total of both improvements for Form 8829:
    1. From within your TaxAct return (Online or Desktop), click Federal. On smaller devices, click in the upper left-hand corner, then click Federal.
    2. Click Business Income in the Federal Quick Q&A Topics menu to expand, then click Business income or loss from a sole proprietorship.
    3. Click + Add Schedule C to create a new copy of the form or click Edit to review a form already created.
    4. Continue with the interview process to enter all of the appropriate information.
    5. On the screen titled Great! Let's get started on expenses for ..., click Enter expenses.
    6. On the screen titled Did you use your home for business purposes for this business?, click Yes.
    7. On the screen titled Business Use of Home - Method, select Simplified Option, then click Continue.
    8. On the screen titled Business Use of Home - Addition or Improvement, use the current year for the Date addition or improvement placed in service and enter the cost or other basis of BOTH improvements.
    9. On the screen titled Business Use of Home - Depreciation Adjustment, enter the adjustment for BOTH improvements as Depreciation adjustment for addition or improvement.
    10. On the screen titled Business Use of Home - Computation, add the prior year computation text after the current year's computation text.
  5. Print a copy of Form 8829 (and Form 4562) at this time. This Form 8829 will be filed with the return, however, this Form 4562 should not be filed with the return.

Note that any link in the information above is updated each year automatically and will take you to the most recent version of the document at the time it is accessed.


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