Allocate an asset individually (section 754)
Section 754 election (step up in basis)
Section 754 lets a partnership choose to adjust the basis of partnership assets. This is often called a step up in basis, and requires individual assets to be allocated.
Do the following to allocate an asset individually:
- Select the business activity folderIncome & Deductions,Farm,Farm Rental,Schedule K, orRent & Royalty.
- SelectAssetto open the UltraTax CS asset module.noteIf the Asset tab isn't available, the client is set up for entering summary asset information instead of detailed asset information. To enter detailed asset information and enable the asset module, selectFile,Client Properties,Advanced Properties,Enter Asset Detail, then mark theEnter asset detail informationcheckbox.Detail vs. Summary Asset Data Entry:You have 2 options to enter asset data. You can enter detailed asset information in the built-in asset module, or you can enter summary asset information on certain input screens. UltraTax CS automatically calculates and transfers data entered in the asset module to the appropriate tax forms. Detailed asset data entry is the application default. To enter summary asset information for the open client, selectFile,Client Properties,Advanced Properties,Enter Asset Detail, then clear theEnter asset detail informationcheckbox.
- SelectSetup, then1065 Allocationto open thePartnership Allocationwindow to select the existing Individually Allocated group.
- SelectIndividually Allocated itemin thePartnership Allocationwindow.
- SelectEdit, thenSelect Assetsto open theSelect Assets - Individually Allocatedwindow.
- Select the asset to allocate and selectOK.
- SelectEnter Special Allocationsto open theSelect Individually Allocated Assetwindow.
- Select the asset you want to allocate then selectContinue.
- Enter the partner allocations for the current depreciation and AMT adjustment for the federal return and any attached states, as needed.noteYou can enter a partial percentage or amount of the allocation then selectDistributeto distribute the remaining percentage or amount equally or pro rata to selected partners.
- SelectOK, then selectDoneto return to theAsset Listwindow. Each asset allocated using the Individually Allocated group is listed separately in the Allocation list in the Allocations window in Partner Data Entry, using the asset's description.
Related Content
-
Allocate an asset group
Format:
Article,
1 min read
-
Allocate amounts to partners
Format:
Article,
2 min read
