Defining tax credit tables

Tax credit tables let you define tax credit percentages and year-by-year recapture percentages for assets. You should use tax credit tables when you convert assets that you have taken investment tax credit on.

This procedure outlines the process for setting up tax credit tables.

You define tax credit tables according to Federal or state tax guidelines. Before you define and use tax credit tables, you should consult your tax advisor.

Set up a tax credit table

  1. Access Tax Credit Table (AM03.1).
  2. Define the name of the new tax credit table in the Tax Credit Table field.
  3. Define the qualifying, tax credit, and basis reduction percentages for the tax credit table. Specify this information:
    Qualifying percentage

    Identifies the percentage of an asset's depreciable basis that qualifies for a tax credit. If you leave this field blank, it defaults to 100%.

    Tax credit percentage

    Used to calculate the tax credit. The system applies the tax credit percentage you define here to the qualifying percentage to get the tax credit.

    Basis reduction percentage

    Used to calculate an asset book's depreciable basis. Each year, the depreciable basis is reduced by the percentage specified here.

    Note: The percentage amounts you specify in the Recapture Percentage fields must equal 100%.
  4. Specify the recapture percentages for the tax credits.

    A recapture percentage is the percentage of the tax credit that is recaptured if an asset is disposed of or retired before its service life is expired.

Related reports and inquiries

To Use
List tax credit tables System Setup Listings (AM200)