1120-US: Form 4626 post-1986 depreciation adjustment (FAQ)

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Question

How does UltraTax/1120 calculate the post-1986 depreciation adjustment?

Answer

UltraTax CS automatically calculates the post-1986 depreciation adjustment amount from information entered in the asset module; the preference items statement dialog in Screens 4835-3, F-3, and Rent-2; and the applicable field in Screen K1-4.

The post-1986 depreciation adjustments derived from passive, at-risk, and tax shelter farm activities are not included in this adjustment. UltraTax/1120 includes these adjustments on the respective lines of Form 4626. UltraTax/1120 prints a statement with Form 4626 showing how the post-1986 depreciation adjustment amount is calculated.

If you enter information directly in Screen 4562, enter the amount of post-1986 depreciation adjustment on Screen AMT.

Related topic: 1120-US: Form 4626 – Alternative minimum tax FAQs

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