Category: Accounting software and technology

The effects of the Alternative Minimum Tax on depreciation

Fixed asset accounting becomes very important with the arrival of tax season. Not having an accurate assessment of the quantity and value of various goods and properties can have two different effects: Either the assets are undervalued and the company is subject to a tax audit, or they're overvalued and the business overpays in taxes. This means taking careful consideration into any variables in taxes that can alter how firms calculate depreciation. This is especially the case when using different methods of taxation, particularly the Alternative Minimum Tax. Understanding the effects of AMT on how a company depreciates its fixed…

Read More

The ideal times to use straight-line depreciation

Various fixed assets require different means to deliver the most value to a business in terms of taxes, resale and contribution to overall net worth. Seemingly minute differences in how a company decides to calculate depreciation can have a great impact on its overall financial health. For many businesses, the use of accelerated depreciation is effective, as it gains the highest value out of the process in case they need to resell or invest in better infrastructure at more frequent intervals. However, there are some assets where that would be not particularly effective, and that is when the more traditional approach of straight-line depreciation…

Read More

Implementing different inventory systems

The key component of fixed asset management is the inventory system. How properties, machinery and furnishings are identified, cataloged and mapped can make a major difference in how a company conducts its operations. Knowing where the right equipment is at any time is an essential, especially on important projects. Being able to maintain a strong inventory can keep things running smoothly and improve efficiency and productivity at a basic level. However, there are different ways to inventory these items, and these should be taken into consideration as the business grows over time. Whatever choice is made, with flexible asset inventory software,…

Read More

How are construction firms affected by TIPA 2014?

The passing of the Tax Increase Prevention Act of 2014 brought a swath of tax extensions that had already expired with the 2013 tax year. While these extensions didn't really help individuals and businesses make solid purchases because the law was only signed on Dec. 19, there are still benefits to be had based on individual and corporate tax returns. Taking advantage of these tax benefits for the year may result in refunds that can be used for capital investment such as fixed assets in the coming year. This is especially the case with construction companies. A large number of…

Read More

Managing obsolete fixed assets

Fixed asset management requires more than maintaining certain equipment and properties. It also means knowing what can be done about items that are no longer viable in a business. For example, some assets may be lost because of damage from severe weather, while others may be stolen. There are also matters of how to account for machines or other things that are no longer physically available but are still on the books. However, one of the more significant problems that businesses run into when handling fixed assets are when they're no longer useful. Obsolescence can greatly affect how companies apply…

Read More