Fully depreciate an under depreciated asset

 NOTE: Use the Manual Method if the asset is using a bonus method. For example MACRS (MA), Straight-line full month (SB). The Remaining Value (RV) method doesn’t allow for a 168k election amount. 
 There are two ways to adjust an asset that has run out of life but still has Net Book Value. The Calculated Method and the Manual Method.

Calculated Method

Asset-by-asset basis - Calculated Method

1. Change the Depreciation Method to RV (Remaining Value over Remaining Life).
2. Answer Yes, Current Thru Date to the questions.
3. Change Estimated Life to cover the time from the asset’s Placed-in-Service Date to the Beginning Date.
   Add the desired Remaining Life so the asset fully depreciates.
4. Answer Yes, Current Thru Date to the questions.

Example

• Placed-in-Service Date: 01/01/2018
• Estimated Life: 3 Years
• Beginning Date is 06/2022 after changing to the RV method
• Desired End Date 07/2022
• Make this asset end on 07/2022
• Change the Life to 0407 (4 years 7 months)
• Notice the extra month included in the final Estimated Life
   (Placed-in Service date through the Beginning Date plus one month)

Manual Method

• This method will NOT show the adjusted amount in Depreciation This Run. Adjust the General Ledger manually
• This method will force the Current Accumulated Depreciation and the Current YTD. It will also fully depreciate the assets

Asset-by-asset basis - Manual method

1. Beginning Date: Date desired to show the item as fully depreciated. This could be the current period or any other date.
2. Beginning YTD: Current Net Book Value + Current YTD (if any). This is to ensure the Prior Accum amount remains correct after the change.
3. Beginning Accum: The full Acquisition Value of the asset.

For assistance in calculating the Estimated Life, use the RVEstLifeCalculator.xlsx

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