Drake Depreciation??

[Terry D EA]

I'm wanting to use the 150 DB method of depreciation for an asset placed in service 10/1/2022. The snip below shows Drake current depreciation. It automatically comes up with the rate of 7.5. My calculations are: 38,933 x .15 divided by 12 x 2 equaling 973.32 for the first year. What am I doing wrong here.  150DB is 15% correct? I also noticed I cannot choose the 150DDB method in Drake either.  How are you handling this?

[jklcpa]

Your math is correct, if that is what you want to accomplish.

Instead of using "DB" as the method, which is for pre-1981 assets, try the code "ALT" that should calculate for alternative MACRS 150%DB.

[Terry D EA]

Judy,

I switched to the ADS on the input and this is what I got. I don't see why it switched to SL. I might try deleting the asset as it is the only one that I have entered so far, and do a repair index files.  Based on the date in service, MQ convention is correct but not SL. 

[Terry D EA]

Crap. My stupid mistake, I chose the ADS instead of ALT.  Now that I chose ALT, the amount of current depreciation is somewhat close to my spreadsheet but not good enough. I tried changing the date of in-service and still cannot get it right. Where is the program getting the "rate" at? Using the same data and change the in-service date to 9/1/2022, the rate changes to 5. This is driving me nuts. 

[Terry D EA]

Now I'm questioning my math. Isn't this correct? 150 DB is 15% for the period. So, 38,932.32 x .15 divided by 12 times 2 = 973.32 for the first year. The following years are off as well in Drake. If I use SL, then everything matches perfectly. Sorry to e such a PITA with this.

[Terry D EA]

Ok I guess I need to walk away from this for a while. My math is definitely not right. First mistake, 150DB to determine the percentage the 150 is divided by the years of useful life. In my case 150/15 = 10% and not 15% 

38,932.97 x .010 = 3893.30,   3893.30/12*1.5 (months) = 486.66. 

Using this method, everything matches. My brain hurts. Something so simple and I made a major catastrophe out of it. Too early in the season for this type of brain fart. 

[jklcpa]

@Terry D EA, I got the same thing because it is using the mid-quarter convention for the 4th quarter.  It's falling into that MQ convention because the program thinks more than 40% of assets placed in service during the year occurred in the 4th quarter of the tax year. Either that is the case and the calculation is correct, or not correct if you haven't entered other assets yet that remove that mid-quarter convention.

$38933 / 15 * 1.5 * 1.5 months of 12 = 486.66.

 

[Terry D EA]

Thanks Judy, I'm right there with you on the calculation. Drake is correct, I checked the reports for future years and it matches my calcs as well. With the asset in-service date of 10/1/2022, the MQ is correct as well. Sorry for the confusion. Most of it was frustration on my part and not taking a break.