L.S. Posted February 17, 2009 Report Share Posted February 17, 2009 How do you handle depreciation when the state does not couple with the federal - i.e. - Special allowance depreciation of 50% that the federal is allowing, but the state of Iowa is not. In the asset entry - it does show the difference - what then? Do you go to the state form and override? thanks. Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted February 17, 2009 Report Share Posted February 17, 2009 As long as you make the adjustment on the asset entry, you should not have to override the state, you just go to the IA4562A form, and fill it out to make the Iowa adjustment. Once you fill it out, it will make the adjustment on line 14 worksheet Quote Link to comment Share on other sites More sharing options...
zeke Posted February 17, 2009 Report Share Posted February 17, 2009 I try to (1) elect out of 50% special, (2) use Sec 179 that IS recognized by state for "additional" exp., thereby maintaining same basis for both Fed & State and not needing additional calcs upon disposition. Works for me. z Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted February 17, 2009 Report Share Posted February 17, 2009 That is what I would choose, if possible, too, Zeke. But if they need to take the bonus depreciation, my answer was to deal with the 'how' of reporting the adjustment. Quote Link to comment Share on other sites More sharing options...
jainen Posted February 17, 2009 Report Share Posted February 17, 2009 >>Works for me<< Does it work for your client, who is probably more interested in easing his own tax burden than easing your paperwork burden? Quote Link to comment Share on other sites More sharing options...
zeke Posted February 17, 2009 Report Share Posted February 17, 2009 @KC - No criticism intended - just trying to participate. @Jainen - We agree entirely that patron's needs take priority. Maybe my "try" at the start of my post did not fully communicate same. z Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted February 17, 2009 Report Share Posted February 17, 2009 None taken, Zeke. Quote Link to comment Share on other sites More sharing options...
L.S. Posted February 17, 2009 Author Report Share Posted February 17, 2009 Our office has been struggling with this issue concerning the 50% special dep. allowance, too. If they don't opt out of this (which most have done), this gets really ugly with the Iowa return - changes to Iowa Sch A, change in how much s.s. is taxable, etc. If they do opt out, we are having clients sign the Election and keeping it on file. Is there any problem in e-filing these returns? The election gets e-filed, too, right? Quote Link to comment Share on other sites More sharing options...
jainen Posted February 17, 2009 Report Share Posted February 17, 2009 >>this gets really ugly with the Iowa return<< Sorry to sound cold, but you get no sympathy from this sunny California preparer. Not only have we failed to conform to special depreciation, we don't even conform to Section 179. In fact, we have never fully conformed to basic MACRS! So we keep separate depreciation schedules state and federal, and work goes on. Quote Link to comment Share on other sites More sharing options...
L.S. Posted February 17, 2009 Author Report Share Posted February 17, 2009 Hmmmmmmmm - would I rather be preparing taxes in sunny California or sub-zero Iowa?? :rolleyes: Quote Link to comment Share on other sites More sharing options...
TAXBILLY Posted February 17, 2009 Report Share Posted February 17, 2009 It's 75 and a beach day today but I have my own pool. :~) taxbilly Quote Link to comment Share on other sites More sharing options...
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