Rental Property Depreciation Correction (Form 3115 & Section 481(a) Catch-Up)
Claim years of missed rental depreciation in a single tax year using Form 3115 and a Section 481(a) catch-up adjustment. No amended returns.
Free. No commitment. We assess your situation in 15 minutes.
In short: Rental owners who never took depreciation, took too little, or used the wrong basis can catch up years of missed deductions in a single tax year using Form 3115 and a Section 481(a) adjustment, without amending old returns. Our flat fee starts at $1,450 for a single residential rental, with a fully credited deposit to begin. A free 15-minute fit check confirms whether a method change or an amended return fits your facts.
What's Included
- Review of your property's depreciation history and prior-year returns
- Corrected cost basis and depreciation schedule
- Section 481(a) catch-up computation
- Form 3115 prepared with all required attachments
- Filing instructions for your current-year return
- The duplicate Form 3115 copy for the IRS office in Ogden, Utah
Timeline: Form 3115 is filed with the return for the year of change, so we set a realistic target date around your return. We can begin soon after you engage.
Not included:
- Amended returns (Form 1040-X), quoted separately if needed
- Bookkeeping or basis reconstruction from incomplete records
- Cost segregation studies (a separate service)
- Audit representation
Catch Up Missed Depreciation on Rental Property, Without Amending Old Returns
Depreciation is one of the largest deductions a rental owner is entitled to, and it is also one of the easiest to get wrong. If you never claimed it, claimed too little, depreciated the wrong basis, or missed improvements that should have been capitalized, the deductions do not simply disappear. In most cases they can be recovered.
The mechanism is a change in accounting method on Form 3115, paired with a Section 481(a) adjustment that captures the full cumulative catch-up. It is filed with your current-year return, so you claim the correction in a single tax year rather than reopening each prior return.
Every engagement starts with a free 15-minute fit check. We confirm whether a method change is the right path for your facts before any work begins, and give you a clear scope and flat fee.
What the Engagement Delivers
- Review of your depreciation history and prior-year returns
- Corrected cost basis and depreciation schedule
- Section 481(a) cumulative catch-up computation
- Form 3115 with all required attachments
- Filing instructions for your current-year return
- The duplicate Form 3115 copy for the IRS in Ogden, Utah
Who This Is For
This service is built for rental owners whose depreciation was never claimed or was claimed incorrectly, year after year.
Owners who never took depreciation
You held a rental for several years and never claimed depreciation on it. The deduction was allowable whether or not you took it, and a Section 481(a) adjustment can recover the cumulative amount in the year of change.
Owners who took too little
Your return claimed some depreciation, but the amount was short, on the wrong recovery period, or applied inconsistently across years. The catch-up captures the shortfall.
Wrong basis or land-to-building split
The building basis you depreciated was off, often from a wrong land-to-building allocation, so every year of depreciation was too high or too low. We recompute the correct split and schedule.
Missed capitalized improvements
Renovations or improvements that should have been capitalized and depreciated were expensed or left off entirely. Those assets can be brought onto a corrected schedule.
How the Form 3115 Depreciation Correction Works
A change in accounting method captures the cumulative catch-up in one place, filed with your current-year return.
Change the accounting method
Form 3115 changes the method of accounting for the property from the incorrect depreciation treatment to the correct one, going forward.
Compute the Section 481(a) catch-up
The Section 481(a) adjustment totals the cumulative difference between the depreciation you should have taken and what you actually took across all prior years.
File with the current-year return
The Form 3115 is filed with your current-year return, and a duplicate copy goes to the IRS office in Ogden, Utah.
Apply the adjustment
A favorable (negative) adjustment is deducted in full in the year of change. An unfavorable (positive) adjustment is generally spread over four years.
Method change or amended return?
A depreciation treatment used for two or more consecutive years is generally a method of accounting, corrected with Form 3115. A single-year slip or a pure error may instead call for an amended return. We confirm which one applies to your facts on the free fit-check call before any work begins.
How Much Does a Form 3115 Depreciation Correction Cost?
We work on a flat fee, so you know the number before you commit. The fee for a single residential rental starts at $1,450, and a fully credited deposit begins the work.
The fee can vary for multiple properties or unusually long depreciation histories, where there is more to reconstruct and compute. Your final flat fee is confirmed on the free 15-minute fit check, after we understand the property and the years involved.
Timeline
Because Form 3115 is filed with the return for the year of change, we set a realistic target date around your return. We can begin soon after you engage.
Flat-Fee Depreciation Correction
- Depreciation history and prior-year review
- Corrected basis and depreciation schedule
- Section 481(a) catch-up computation
- Form 3115 with all required attachments
- Filing instructions plus the Ogden duplicate copy
- Fully credited deposit to begin
Prepared by an Enrolled Agent
Arc & Ledger is led by Burak Genc, an Enrolled Agent federally authorized to represent taxpayers before the IRS. Depreciation corrections and Form 3115 method changes are handled directly, with your questions answered in plain English and Turkish.
The firm is based in Culver City, California, and works with rental owners across the United States through a secure client portal.
Ready to recover your missed depreciation?
Start with a free 15-minute fit check. We confirm the right path for your property, then give you a clear scope and flat fee.
Book a free 15-minute fit checkThis page is general information, not tax advice. Eligibility for a Form 3115 accounting-method change and the result of any Section 481(a) adjustment depend on the specific facts of your property and returns. A fit check is required before any engagement begins.
Frequently Asked Questions
Common questions about this service area.
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Learn MoreBook a free 15-minute fit check
We confirm whether a Form 3115 method change or an amended return fits your facts, walk through scope and the flat fee, and answer your questions. A fit check is required before any engagement begins.
“Arc & Ledger provided exceptional service, making my tax preparation seamless and stress-free.”– Christian S., Google Review
Both reach the same Enrolled Agent review. After either one, you'll receive a secure Client Portal invitation to upload your documents.