Accelerate Depreciation on an asset to a specific date

Hello Suni

There is an Excel spreadsheet attached (which means you need to scroll all the way down) to How to fully depreciate an under depreciated asset (16868) which is setup to calculation the estimated life for just this purpose. Just remember you cannot dispose the asset in the same month as the target date.

~Delray

Thank you for the response.  I am new to Sage/Fixed Assets so it's all still a little foreign to me but I think I follow.  Thank you again!

As I am working through my assets I have come across a couple scenarios that concern me.  Am I ok to use either method on transferred assets?

1.  I have old assets that are the result of transfers done back in 2016, (A) the current method is MA200, the system warns me that I should not change the Beginning Info as it contains important info regarding the depreciation expense as of the transfer date.  (B) the current method is MT100 the system warns me that the Depreciation will be reset to the beginning depreciation amounts.

2. When changing the Method to RV I get a warning that this method is outdated and is not normally used after 1980.?!?

Hello Suni,

First, I am not an accountant. The steps in How to fully depreciate an under depreciated asset (16868) while they will still work, is not intended for use in the Tax book since the Tax rules differ from the Internal book in many ways one of which is that the Tax methods tend to still fully depreciate within their Tax Class (a.k.a. Estimated Life) even if under-depreciated, due to the nature of the MACRS formula being based on the NBV as of the end of prior year and not always being calculated off the Acquired Value. Of course, your MT100 asset would be an exception to that rule.

Accelerating the depreciation in the Tax book is just not something we normally see, but if your Tax Advisor is ok with it, no problem.

Correct, you cannot edit the child of a transfer without effect the prior calculations, which is why the Beginning Date is the only option but replicating then inactivating that asset gets around that issue. See Beginning Date is the only option when changing Critical Fields (17689) for the steps.

However, you will have an additional issue with the MA200 since changing the method RV will remove the 168 Allowance amount from depreciation and puts that amount back into the Depreciable basis. The 168 allowance is always taken in the first month of the asset's life which makes the correct answer to changing the Method, either to or from a 168 method, is to reset to the Placed-in Service date. The only way around that, in the replicated asset, is to manually enter that 168 amount back into the Beginning accum which will skew the Prior accum or Current YTD amounts.

The warning is just that, a warning which can be ignore. It is saying that you are entering a non-tax method into a Tax book which may or may not be fine. I might suggest the use of RH (Remaining Value Half Year) for the MA200 asset and the RM (Remaining Value mid-month) for the MT100 asset which are methods recently created to deal with some new ACRS Tax rules which should cut down on a few clicks.

~Delray