I’ve covered a couple of times how Microsoft Dynamics GP lets companies deal with bonus depreciation. What happens if year end comes an goes and you missed taking bonus depreciation? Hopefully the accountants will catch it when preparing the tax return and now you’ve got to fix in GP.
Some of the obvious solutions won’t work because once you’ve closed the year, resetting the year’s depreciation only works in the current year, not last year.
This came up recently and this is best solution I’ve come up with.
- Set the date in GP back to the previous year
- Open the Tax book for an item that didn’t get bonus depreciation.
- Change the LTD depreciation to be the depreciation as of year end from the tax return for that asset PLUS the YTD depreciation.
For example: 1,200 asset, depreciation with bonus should have been $700 as of 12/31. YTD is $50. New LTD would be $750.
- GP will book the transaction as of the GP date and will reflect the date of the change in the Financial Detail window
Bonus depreciation is tax only so this shouldn’t change the ledger. Bonus depreciation should only apply to assets placed in service during the year, not all assets. Don’t forget to change the GP system date back when you’re done.
I haven’t found any way to get GP to recalc the bonus depreciation and after I thought about it, you really want GP to reflect what was on the tax return right or wrong.