schedule L problem

Forum|Forum|5 years ago
September 18, 2020
2 replies
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Hello Everyone!

I filed few 1120s returns from financial statements i got from an bookkeeper. I noticed that no depreciation was taken on those returns. So in order to match my m1 to the financials provided. i manually made sure no book depreciation was taken. I did that by going into "balance sheet misc" tab and put "-1" for current year book deprec. and amort.

is that a problem? should i amend these returns?

i further noticed that 2 returns were rejected because by following the above steps i took... my schedule L had shown "-1" as accumulated deprec. and accumulated amort. on my Schedule L. i was allowed to file my federal return by my state return got rejected. I fixed the return by taking out the -1's and now my state return and federal return's schedule L are off by $1.

please provide guidance as to how i should handle this.

Thank you very much.

Lacerte Tax

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qbteachmt

Level 15

"i manually made sure no book depreciation was taken"

Did you follow up with the bookkeeper? Many of my clients tell me they wait for the tax return prep and make those entries per the tax preparer's direction. You might have done this backwards.

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H

here2learnAuthor

Level 2

no I did not follow up with the bookkeeper.

I was thinking we can book the depreciation in the following year. but does this cause any issues with the tax return? at the moment i was thinking no... but when i saw the state rejection. i am thinking more about it.

qbteachmt

Level 15

"I was thinking we can book the depreciation in the following year. but does this cause any issues with the tax return?"

Well, you want everything to be accurate. You told us the returns had no depreciation; was there supposed to be some on them?

You can catch up the bookkeeping any time, but the entries should be dated for when they apply, of course. And if they then affect something else you used for the tax return, then the sequence of your work would be reviewed, to see if it was done out of order.

Don't yell at us; we're volunteers