Taxpayer is a MN resident, spouse is a IA resident during 2021. T/P has a Sch C business, has taken bonus/179 in years 2019 and 2020. On their 2021 return, my software is generating a large IA deduction for depreciation adjustments for prior year items from 2019 and 2020 that were depreciated in MN. No prior IA adjustments have been made.
Reading the instructions, it appears there shouldn't be a Form 4562A generating if there were no prior IA adjustments on these items. Am I reading that correctly? Seems odd the taxpayer would get a large IA depreciation deduction when there were no add backs in prior years while not doing business in IA.