Tax Book Net Value

I am being asked, "For the Tax Book, how is there a NBV but no Depreciation has been ran this year?" For the following item:

BUILDING - Property Type R

Tax Book:

Placed in service: 10/01/1982

Value: $889,038.09

Depreciation Method: SL

Life: 15 years 

Current YTD: $0

Current Accum: $886,208.52

Net Book Value: $2,829.57

Internal Book: 

Placed in service: 10/01/1982

Value: $889,038.09

Depreciation Method: SL

Life: 40 years 

Current Accum: $865,182.06

Net Book Value: $23,856.03

  • Hello,

    The usual reason for a SL asset to stop depreciation is because it is under-depreciated. In other words, there is Beginning information on the asset where the Beginning Accum amount is less than what the program would have calculated over the same period of time between the Placed-in Service date and the Beginning Date.

    See How to fully depreciate an under depreciated asset? (16868) for the two method typically used in these cases. For the Calculating Method, I would suggest RM instead of RV as the method to use.

    ~Delray