Tamarack Trail Mix: Bonus Depreciation

This Trail Mix installment describes how to leverage the 100% Bonus Depreciation mass update utility within InfoLease. The 100.PCT.FED.DEPR.UTILITY was designed to make federal depreciation changes for 100% Bonus Depreciation (take 100% depreciation in the first year) using the percent method.

You may recall that the Tax Cuts and Jobs Act, enacted at the end of 2018, increases first-year bonus depreciation to 100% for any long-term assets placed in service after September 27, 2017. The 100% bonus depreciation amount remains in effect until January 1, 2023.

If you have assets that went into service in 2021, you may still have time to recalculate depreciation expenses on those assets. Please consult with your finance department or corporate CPA before proceeding. This utility enables you to update those assets en masse rather than touching each individually.

Specifically, the utility updates Federal Convention, Federal Method and AMT/ACE values if the AMT/ACE flags are set to “Y”es.

Steps:

1. Create a saved list of the asset IDs you wish to update.
   • For example, to select active True Lease (TL) Assets that have a basis > 0 and do NOT currently take a 100% bonus:
     SELECT AS.MASTER WITH LEASE.TYPE = "TL" AND WITH BEG.DEPR.DATE GE "01/01/2021" AND BEG.DEPR.DATE LE "12/31/2021" AND WITH A.DISP.DATE = "" AND WITH DEPR.BASIS > "0" AND WITH FED.DEPR.PCTS = ""
   • Save list of assets to a new list. Ex: 2021.TL.ASSETS
2. At TCL enter, 100.PCT.FED.DEPR.UTILITY
   • Enter the saved list name when prompted.
   • Specify whether AMT/ACE depreciation should be updated
   • When the utility runs, InfoLease updates the selected depreciation percent table taking 100% in the first year.
3. Next, run RECALC.DEPR.TABLE which calculates the depreciation tables for the asset records residing in the recalculation file.
   • Change Logs will be created reflecting these changes.
4. The next time period-end is run, InfoLease will recognize the additional depreciation in the first year and update the MTD, YTD and CTD depreciation amounts accordingly.
   • Corresponding General Ledger entries will be created at month end.

Note: If you currently use InfoLease 10 and are unsure how to perform these steps, contact Tamarack or Solifi for assistance.

Have a Trail Mix Idea or Solution?

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