Investment Tax Credit Field

Use this book information field in Asset Detail to enter the Investment Tax Credit (ITC) amount applied to the asset (if applicable). ITC allows a credit for a percentage of an asset's cost basis, based on the estimated life of the asset and when you placed it in service. To enter an amount, click in the Investment Tax Credit field, and then select the arrow. The system displays the Investment Tax Credit window. In the ITC Credit field, the system only displays ITC options that are valid for this asset based on property type, service date, and depreciation method. Select one of the valid ITC options for this asset.

If you choose an ITC option other than X, the application automatically determines the ITC percentage based on the option chosen, the year you placed the asset in service, its property type, its estimated life, and its depreciable basis. The percentage field displays the system-determined percentage. You can override the percentage or amount of ITC taken, which can be useful if the asset is allowed more than one type of credit (such as an energy credit and a regular credit).

To accept the system's percentage, select OK. To override the default, enter a different percentage in XX.XX format.

After you enter the percentage and select OK, the system calculates the amount of the ITC as the asset's depreciable basis multiplied by the ITC percentage. If the asset's depreciable basis is not the same as its at-risk basis, you may need to adjust the calculated amount.

To override the calculated amount, select the arrow again, enter the new amount, and select the OK button. The system adjusts the ITC percentage automatically.