TAXMAN Posted February 3, 2014 Report Share Posted February 3, 2014 In running error check I got a strange error message in red that said depreciation method does not appear to be correct for time in service. This asset was placed in service in 2012. Went back to 2012 to look. I had my guy put this in our 2012 program as it was on TP print out. Ran error check 2012. Numbers all appear to be correct with no error messages.Deleted asset and put back in according to 2012 dep sheet. Again I got same message. This is comming from another preparer that used ATX in 2012. asset in question was a chimney placed under 15 year life with 125db method and a midqtr conven. This is what was on the 2012 form.Prior return dep maybe incorrect with the 125db? I am thinking should have been mabe 150db?You all have any suggestions except to override to get rid of red error? Quote Link to comment Share on other sites More sharing options...
Elrod Posted February 3, 2014 Report Share Posted February 3, 2014 When I am certain of the accuracy in record, I override. Quote Link to comment Share on other sites More sharing options...
jklcpa Posted February 4, 2014 Report Share Posted February 4, 2014 In running error check I got a strange error message in red that said depreciation method does not appear to be correct for time in service. This asset was placed in service in 2012. Went back to 2012 to look. I had my guy put this in our 2012 program as it was on TP print out. Ran error check 2012. Numbers all appear to be correct with no error messages. Deleted asset and put back in according to 2012 dep sheet. Again I got same message. This is comming from another preparer that used ATX in 2012. asset in question was a chimney placed under 15 year life with 125db method and a midqtr conven. This is what was on the 2012 form. Prior return dep maybe incorrect with the 125db? I am thinking should have been mabe 150db? You all have any suggestions except to override to get rid of red error? If it's really 15 year property, then you are saying this is a qualified leasehold improvement, and I think those are supposed to use 15-year MACRS SL. This chimney is part of a nonresidential property, right? Quote Link to comment Share on other sites More sharing options...
Mr. Pencil Posted February 4, 2014 Report Share Posted February 4, 2014 depreciation method does not appear to be correct for time in service. This asset was placed in service in 2012. Since the time in service was post-1980, 125% DB is not an allowable method for tax accounting. And I would guess that 15 years is not the correct MACRS recovery period for real property. Did you ask why he didn't go back to his previous preparer? I think he needs to amend the prior year return. Quote Link to comment Share on other sites More sharing options...
TAXMAN Posted February 5, 2014 Author Report Share Posted February 5, 2014 Previous preparer in hospital with coma. In fixing to what it realy should be only amounts to a $3 dep change(2012) whould you override and keep going with current figures or fix it(method) and move on. Really amounts to about a $12 increase in 13 than what would have been under the way original preparer had done. Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted February 7, 2014 Report Share Posted February 7, 2014 For such a minor change I'd just fix it this year and move on. Quote Link to comment Share on other sites More sharing options...
TAXMAN Posted February 7, 2014 Author Report Share Posted February 7, 2014 I kinda thought this would be the easy way to fix since the amount is so minimal. Thanks Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted February 8, 2014 Report Share Posted February 8, 2014 You're actually doing them a favor, it would cost a lot more than that for them to make the changes in their system. Quote Link to comment Share on other sites More sharing options...
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