How GoCodes calculates deprecation
GoCodes includes sophisticated yet easy-to-use depreciation calculations that cover all the most common scenarios for most fixed-assets. We take the asset data you input like the cost of the asset, date purchased and asset life and use this information to calculate annual depreciation using a range of the most common IRS MACRS schemes. We do this by providing a series of pre-built depreciation reports which can be run with a single click. The reports generate a Microsoft Excel compatible .csv file which contains a list of your assets along with their corresponding depreciation data like annual depreciation, current year depreciation, prior year depreciation, total depreciation to-date and balance remaining to be depreciated. This information is calculated in accordance with US IRS publication 946 conventions and can be used in the filing of financial statements and tax returns*
Which depreciation options does GoCodes support
GoCodes is designed to make it easy to complete the most common asset deprecation scenarios with confidence. All GoCodes depreciation reports adopt the half-year (HY) convention required by the IRS.
Here’s a summary of the deprecation calculations GoCodes offers:
- Modified Accelerated Cost Recovery System (MACRS) Straight Line (SL) depreciation with half-year (HY)convention
- MACRS Declining Balance (DB) 200% with HY convention
- MACRS Declining Balance (DB) 150% with HY convention
- MACRS Straight Line (SL) depreciation with HY convention with 2017 bonus deprecation @50%
- MACRS Declining Balance (DB) 200% with HY convention with 2017 bonus deprecation @50%
- MACRS Declining Balance (DB) 150% with HY convention with 2017 bonus deprecation @50%
- Microsoft Excel (CSV) - SL Monthly Depreciation
- Microsoft Excel (CSV) - SL Monthly Depreciation + IRS PATH 2017 @50%
How to calculate depreciation using GoCodes
When you’re ready to calculate depreciation, you should complete the following steps:
- Ensure your asset date is input correctly, note that a valid purchase date, cost and asset life are required for the calculations to work correctly. Specifically, the purchase date must not be a future date, the cost should be a positive number and the asset life should be a rounded positive number. The most common are examples are 3,5,7,9,10 & 15 years
- If you are using more than one type of deprecation then it’s a good idea to use a data field or a custom data field to track the type of depreciation that you will be using for each asset. This information will be used to filter the assets into group when you run the deprecation report. We recommend using the ‘Group’ data field by adding a drop-down menu option for the different depreciation calculations you plan to use.
- Navigate to the ‘Reports’ menu and scroll down to the ‘Fixed Asset Depreciation Reports’
- Decide which report calculation you want to run and click the appropriate report.
- Your report will run and create an Excel .csv file which you can save locally.
- When you open your report, you will see a new set of calculated depreciation columns for each asset. These are calculated based on the current date and will show the following calculations:
- Straight Line Annual Deprecation (for reference purposes)
- Prior Year Depreciation (for last year’s tax year filing etc.)
- Current Year Depreciation
- Total Depreciation for all years
- Balance remaining to be depreciated
- We recommend you add a data filter to your report to just show the assets you are interested in. You can do this using the Group data field that you just setup.