1120-S Sch L Accum Dep not balanced to Dep Sch on return

[ea_rva aka acctgtaxmatters]

Happy Monday!

A new SCorp referral...no payroll, no accounting system, no balance sheet or P&L etc....they will receive info from me in writing that this does not meet IRS requirements....

The prior tax preparer's Schedule L's  ending accumulated depreciation included is $59,400 less than what is showing up for prior year Accum Dep column on the depreciation schedules. No Section 179 or Bonus Dep taken in prior years.

Also, if I compare the deprecation expense taken last year, it is $4,500 more that the actual increase in Accum Dep on last year's Sch L.

All of the beginning balances for the figures mentioned above match what she had as ending balances when I converted the data...so that is not the issue.

Do I adjust my ending 2022 Sch L to match the Accum Dep on the deprecation schedules? If so, do I adjust against retained earnings first then add'l paid in capital?

Thank you in advance for your help as always. I so appreciate all of you...for your direct posts to my questions and those you've posted to help others!! 

[IRonMaN]

Silly question, but were they doing book deprecation for the balance sheet and preparing the return with tax depreciation?

[ea_rva aka acctgtaxmatters]

The client does everything manually so no books on his end. Could be the prior tax preparer had something they were tracking in a spreadsheet...the assets are all rental homes being depreciated at 27.5 SL.

[IRonMaN]

How far back does the client have returns?  Sometimes you can spend a few minutes solving mysteries and sometimes you need Robert Stack to come back to do another episode of Unsolved Mysteries.  We aren't miracle workers so sometimes you bandage up the client the best you can and tell them to go to church every Sunday for the next few years and pray everyday.  

[ea_rva aka acctgtaxmatters]

I have copies back to 2017. 

[IRonMaN]

Take a gander and see if something looks wonky along the way.  Maybe something will jump out at you or maybe the mess was created before that time period.