MACRS asset calculating as straight-line
Depreciation calculates using straight line instead of MACRS when you enter a life for a MACRS asset, or when straight line gives an equal or greater deduction.
When you enter
Asset Detail
for an asset with a MACRS method, you don't need to enter a Life
. The MACRS method already implies the life. If you enter a Life
for an asset with a MACRS method, GoSystem Tax calculates the asset using the straight-line method instead of MACRS.If you leave
Life
blank, depreciation may still calculate using straight line once it provides an equal or greater deduction than MACRS.This follows IRS Publication 946: “When using a declining balance method, you apply the same depreciation rate each year to the adjusted basis of your property. Use the applicable convention for the 1st tax year and you must switch to the straight-line method beginning in the 1st year for which it will give an equal or greater deduction.”
