Automatic adjustments
You can set adjusting entries in either the Home window or TAS to automatically adjust certain items of taxable income and expense based on selected limitations or computations for all associated entities and binders.
You can set adjustments to automatically adjust certain items of taxable income and expense based on selected limitations or computations. Tax adjustments are entered in a journal entry format, producing the book/tax reconciling differences on various Federal forms, with the assignment of a debit/credit impact TRC/TCC code to each adjustment specifying its presentation on the Schedule M-1.
Automatic calculations include:
- Reverse account balances to zero
- Adjust for differences between beginning and ending balances
- Close net income
- Reduce amounts by a user-defined percentage
Common automatic adjustments
Entry | Drop-down | Balance entry account | Reverse option | End / beginning difference | % of difference |
|---|---|---|---|---|---|
Reverse federal income tax provision (FIT) | Target account: Fed income tax provision
| Retained earnings (unappropriated) | Negate | Ending | 100% |
Meals and entertainment | Target account: meals & entertainment
| Retained earnings (unappropriated) | Negate | Ending | 50% |
Allowance for bad debt | Target account: bad debt reserve
| Bad debt expense | Negate | Difference | 100% |
