Year-End Tax Reporting

Asset Reporting for Taxes

Every year, we have to report our assets for Tax purpose. We file with the Federal Government for Asset Depreciation, and with Chatham County for business asset taxes.

Lucky for us, CurrentRMS keeps track of all the equipment transactions, so it is relatively simple to extract the data we need.

Yearly Transactions File

The following is the process to generate an excel file to provide the data we will use to udpate Quickbooks and fill the Georgia PT-50 form and the Federal Depreciation Schedule

1. Run the Stock reporting Python script (v:\z-Misc\stock.py) and use option (40) to generate the jml-transactions.csv file
2. Sort the file by Acquisition Date and then Name
3. Use the Filter to filter out Type 2 (Sale items) so we only have the rental stock displayed
4. Use the filter to only show the Tax Year's Transactions
5. Use the Filter to filter out "Find", "wrOff" and "Sold" transactions (i.e. just the stuff we added)
6. Cost column should not be empty. Cost should be 0.01 to indicate that something is part of a bigger package (Cost in the 1st line of comment field in stock level).
7. Make sure equipment acquisition dates are correct and match a purchase
8. Copy all the sheet content to a new sheet - This removes the filtered out entries - Call this sheet Acq
9. Sum up all the costs (column F) - That should be how much equipment we added this year.
10. Go back to original sheet and clear out all filters
11. Filter out Type 2 and 0
12. Filter to display Disposal dates for Tax Year
13. Copy the sheet to a new Sheet called Disposals
14. Add a column which contains the =YEAR(acq. date) to extract the acq date year
15. Add a column called Gap, which contains the formula =YEAR(J2)-YEAR(G2)+1
16. Add a Column called AssetCst, with formula =IF(C2="Yes",F2,0)
17. Add a column called Recap, with formula =IF(N2>0,IF(M2>4,F2,F2*M2*0.2),"")
18. Use Subtotal (in Data menu) On "Year Change" sum "Cost","AssetCst" and "Recap"
19. This gives you sales from each year.
20. Put each year's totals in the disposal column.
21. Make a Copy the disposals sheet
22. Delete the Following Columns: Id, Type, A/E, Asset, Transact, Qty, Disp.Qty, Year
23. Add a Title Line: Tax Year Equipment Disposal - JML
24. Save As the workbook in V:/admin/taxes/year/Equipment year.xls
25. Print this sheet of disposals to attach to PT-50

1. The Recap column is used to calculate the Depreciation Recapture which we use in Quickbooks

QBO Equipment Disposal Accounting

In QuickBooks, when we dispose of equipment that is an ASSET, we need to remove the value of the gear from the Asset accounts. There is an account for every year we purchase items classified as assets that we use to track depreciation with.

1. Create a new Journal Entry and date is 12/30/<Tax Year>.
2. For every asset account that has disposed of assets, add a Credit entry matching the Asset COST column for that year.
3. Once all years are accounted for, add a 1710 Accumulated Depreciation DEBIT entry with the total Recap value.
4. Add a new entry "7100 Gain/Loss on Equipment Disposal" which will automatically be filled out by QBO so the DEBIT and CREDIT match.

PT-50 Worksheet

In v:\ADMIN\Taxes, there is an excel sheet called Chatham County Tax Worksheet

It needs to be updated for the current year:

1. Make a Copy of the previous Year's Worksheet and call it current year
2. Move the Year line content down by one and add the current year on line 8
3. copy the values of column I (Adjusted Cost) to Column C (previously reposted)
4. Clear column G (disposals)
5. Copy C20 to C19 (i.e. Current Year to Previous year)

1. Take the total of the Acquisition Sheet and put it in Tax Year's "Additions/Transfers In"
2. On the Disposals Sheet, put the disposals by Year in the "Disposals/Transfers Out" Column
3. On the Disposals Sheet, take a look at the AssetCst and put in the Asset Out column for the correct year
4. On Quickbooks, look at the <Tax Year> Original Asset Value balance, and put that in the "Asset Add" for current year on the PT-50 worksheet
5. Take the Previous Year's "Asset Cost" and put them in the "Asset Previous" column in the current year
6. Current Year's Expense Add is "Adjusted Original Cost" - "Asset Add"

You will use this spreadsheet to fill out the PT-50 form at tax time.

Federal Depreciation Worksheet

In v:\ADMIN\Taxes, there is an excel sheet called Straight Line Depreciation & Value

1. Open it and copy last year's tab to a new tab for the current tax year.
2. Update the "Year" column by 1 for each account
3. Update the Current Cost column with the balances from the various matching Asset Accounts.

We will use the Current Depreciation column in the next section.

Save the file and email it to accountant.

Year-End QuickBooks Depreciation Entry

We need to make a new journal entry on 12/31/<Tax Year> which represents the Asset Depreciation. We will use the data from the Straight Line Depreciation Account worksheet.

For Every Asset Account, we add 2 entries to the Journal:

1. add a 8300 Depreciation Offset entry: DEBIT for the account's Current Dep from worksheet
2. Comment should have form: "2017 Equip: Orig: <Orig Value> - Salvage: <Salvage> - Dep Basis: <Dep Basis> - Year X of Y @ 20% (dep rate)
3. add a countervailing CREDIT entry for same amount, same comment. If it's equipment, use account 1710, if it's a vehicle, use 1720.

Special Reporting Software

Benoit designed a python program (stored on V:\z-Misc\stock.py) to be able to track the various stock transactions that happen directly from current. This is used mainly to keep track of the rental stock we bought and sell or write-off, since this affects taxes at the end of the year.

This is a program that is very user unfriendly but extracts the info we need.

Whenever a new item is added to current, use option 91 to get a list of all the items. When a new stock transaction happens, use 92 to get all the stock transactions.

Once all the transactions are imported, then you can use the following:

(18) Fetch Specific Stock level from Server (use Id on the Resource Product Page URL)

(30) Disposal Transactions: Lists all the items that have been disposed of in the file disp.csv

(40) Lists ALL the transactions for everything and saves it in jml-transactions.csv

(41) Lists the rental item transactions and saves it in jml-transactions-stock.csv

(42) Lists the sales items (i.e. expendables) and saves it in jml-transactions-sales.csv

We use (41) to tally all the equipment we purchased over the year. For the current tax year, we use that to ADD to the PT-50 Georgia sheet.

We use (30) to tally everything that sold or was written off in a year. This is used for PT-50 reporting to decrease our taxes since we don't have the equipment anymore.