Screen INDepr - Indiana Depreciation Adjustments (1040)

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See also: 1040 Indiana frequently asked questions

Overview

The Indiana Department of Revenue requires taxpayers to report adjustments on Schedule 1 or Schedule B for differences attributable to depreciation amounts claimed under federal law on the federal tax return and depreciation amounts allowable on the Indiana tax return under Indiana law. UltraTax/1040-IN uses information from the asset module, federal Form 4562, the Indiana 4562 Worksheet, and federal Screen K1-St to calculate depreciation adjustments on the Indiana Depreciation Reconciliation Worksheet and the Indiana Adjustment for Disposition of Assets Worksheet. Amounts from the worksheets are used to calculate Indiana Schedule 1 and Schedule B. Use this screen to modify depreciation adjustments reported on the worksheets and schedules.

Previously, Indiana required taxpayers to report depreciation differences between the federal return and the Indiana return according to type of property (Motorsports entertainment complex property, Qualified disaster assistance property, Qualified leasehold improvement property, Qualified refinery property, Qualified restaurant property, or Qualified retail improvement property) when applicable. Indiana no longer has such a requirement other than for the reporting of a "catch-up" adjustment (negative add-back) in the final year of depreciation or year of disposal (see Screen INAdj-2). You still have the option to assign an asset to a specific category of property by using the association IN - Qualified Property in the Depreciation tab or the Other tab of the asset module. However, UltraTax CS does not use this information when calculating the Indiana return.

Depreciation Adjustments from Pass-Through Entities: To include Schedule IN-K1 or Indiana Schedule K-1 Equivalent depreciation adjustments from pass-through entities on the Indiana Depreciation Reconciliation Worksheet, enter amounts for the proper categories in the Nonconforming State Depreciation Adjustment section of federal Screen K1-St (or in the Allocation Spreadsheet) in the K1 P/S or K1 E/T folder.

The following fields in federal Screen K1-St may be used only when the state postal code is IN.

Adjustments for State Differences in Depreciation

Use this section to enter adjustments for depreciation differences to report in the Fed/IN Difference column of the Indiana Depreciation Reconciliation Worksheet or to force the amounts reported on the Adjustment for Disposition of Assets Worksheet. Amounts from the Worksheets are reported on Schedule 1 or Schedule B.

To report an amount in the K-1 Adjustment column of the Depreciation Reconciliation Worksheet for adjustments from pass-through entities, enter data and postal code IN on the applicable unit of federal Screen K1-St in the Nonconforming State Depreciation Adjustment section for the appropriate category of property.

Section 179 Expense

Use this section to edit amounts calculated on the 4562 worksheet(s) due to differences between federal and state Section 179 limits.

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