Depreciation Calculator Help
Depreciation Calculator is not a Fixed Assets Manager. However, It will assist you in managing your Fixed Assets. Simply select your depreciation options, click on the "Depreciate" command and in the blink of an eye, your property is depreciated. Depreciation Calculator will display your year-by-year depreciation as well as the accumulated depreciation. Here is a list of the Depreciation Options and explanation on how to complete them:
Property Description:
Enter a description of the property to be depreciated. This field is not required in order to compute depreciation, however, it is useful in describing the property and it will be printed on the Depreciation Report (examples: "Computer System", "Truck/Tractor", "Commercial Building").
Property Types:
Furniture and Equipment: If you are depreciating computers and peripherals, telephone systems, typewriters, calculators, copy machines, fax machines, office furniture (desk, chairs, filing cabinets, safes, etc.), land improvements (sidewalks, roads, fences, landscaping), personal property with no class life, select this option as your Property type.
Automobile: If you are depreciating a passenger automobile, select this option. The program will attempt to depreciate the vehicle over a 5 year period. However, if the vehicle's Cost or Basis price exceeds $65,000.00, the Luxury Auto Depreciation Limits will apply and the vehicle will be depreciated over a longer period than 5 years.
Van Light Truck or SUV (Sport Utility Vehicle): If you are depreciating a minivan, light truck, or a sport utility vehicle which are built on a truck chassis, select this option. The program will attempt to depreciate the vehicle over a 5 year period. However, if the vehicle's Cost or Basis price exceeds $65,000.00, the Maximum Depreciation Limits will apply and the vehicle will be depreciated over a longer period than 5 years.
Truck or Heavy Vehicle: This property type is reserved for a heavy truck or tractor trailer for over the road use. If you are depreciating this type of vehicle, then select this option.
Residential Real Property: If you are depreciating a building or structure, such as a rental home (including a mobile home), if 80% or more of its gross rental income for the tax year is from dwelling units. A dwelling unit is a house or apartment used to provide living accommodations in a building or structure. It does not include a unit in a hotel, motel, or other establishment where more than half the units are used on a transient basis, then select this option.
Non-Residential Real Property: If you are depreciating property, such as an office building, store, or ware-house, that is neither residential rental property nor property with a class life of less than 27.5 years, then select this option.
Date Placed in Service:
Enter the date the property was placed in service. The program will use this date for display purposes and to determine which maximum depreciation limits apply to luxury automobiles. This date field will also be used to determine which quarter the property was placed in service if you are using a Mid-Quarter Convention, or the month the property was placed in service if you are using a Mid-Month Convention.
Cost or Basis:
Enter the Cost or Basis of the property to be depreciated.
Depreciation Method:
MACRS (Modified Accelerated Cost Recovery System): MACRS is a system of recovering the cost of qualifying property over a period of time as specified by the Internal Revenue Code. MACRS uses the 200% declining-balance method (with a switch to straight-line in the year it is greater than the 200% declining-balance method) for all personal property except personal property with 15 and 20 year recovery periods. For personal property with 15 and 20 year recovery periods, the 150% declining-balance method is used (with a switch to straight-line in the year it is greater than the 150% declining-balance method).
Straight-Line: This method lets you deduct the same amount of depreciation each year over the useful life of the property.
Convention:
Half-Year: Use a Half-Year Convention if no other conventions apply.
Mid-Quarter: Use a Mid-Quarter convention if the mid-month convention does not apply and the total depreciable bases of MACRS property you placed in service during the last 3 months of the tax year (excluding non-residential real property, residential rental property, any railroad grading or tunnel bore, property placed in service and disposed of in the same year, and property that is being depreciated under a method other than MACRS) are more than 40% of the total depreciable bases of all MACRS property you placed in service during the entire year.
Mid-Month: Use the Mid-Month convention for nonresidential real property, residential rental property, and any railroad grading or tunnel bore.
Depreciable Life:
Select 5, 7, 10, 15, or 20 years for Furniture and Equipment type property.
3-Years is automatically selected for Truck or Heavy Vehicle type property.
27.5-Years is automatically selected for Residential Real Property type.
39-Years is automatically selected for Non-Residential Real Property type.
1st Year Bonus Depreciation (for assets placed in service in 2024):
Check this box to compute the 60% 1st year bonus depreciation
Fiscal Year Ending Date:
If the business is based on a calendar year, then enter December 31 (12/31) and the current year. If the business is based on a fiscal year, then enter the fiscal year ending date. This fiscal year ending date will be compared to the date the property was placed in service in order to compute the correct depreciation.
The Depreciate Command:
Once you have selected your depreciation options, click the "Depreciate" command and the property's year-by-year depreciation will be calculated and displayed within the display window.
The Display Window:
The display window only displays the property's year-by-year depreciation, it does not allow the data displayed within the window to be modified.
The Print Command:
Click the "Print" command to print a Depreciation Report (registered version only).