Changing the Depreciation Method of a Single Asset

You can change an existing asset’s depreciation method so that it receives the 168 Allowance, assuming the asset qualifies for the additional allowance. For information on which assets qualify for the additional allowance, see Assets That Qualify for 168 Allowance Switch.

Note: You can also change the depreciation methods for a group of assets, so that they either take the additional depreciation allowance or elect out of the additional depreciation. For more information, see Performing a 168 Allowance Switch.

The table below shows which depreciation method you would select to receive the 168 Allowance. For example, if a qualifying asset currently uses depreciation method MF200, you would change its depreciation method to MA200. The depreciation methods in the left column do not take the 168 Allowance. The depreciation methods in the right column do take the 168 Allowance.

Depr Methods with No 168 Allowance		Depr Methods with 168 Allowance
MF200	MACRS Formula 200	MA200	MACRS Formula 200 Plus 168
MF150	MACRS Formula 150	MA150	MACRS Formula 150 Plus 168
MF100	MACRS Formula 100	MA100	MACRS Formula 100 Plus 168
MI200	MACRS Indian Reserv. 200*	MR200	MACRS Indian Reserv. 200 Plus 168*
MI150	MACRS Indian Reserv. 150*	MR150	MACRS Indian Reserv. 150 Plus 168*
MI100	MACRS Indian Reserv. 100*	MR100	MACRS Indian Reserv. 100 Plus 168*
AD	ADS Straight-line MACRS	AA	ADS Straight-line MACRS Plus 168
SF	Straight-line full month	SB	Straight-line full month Plus 168

*See MACRS Method MI and MACRS Method MR.

Caution! If you change an asset’s depreciation method after you have calculated depreciation on it, two warning messages appear. It is important to respond to these messages correctly.

To change an asset’s depreciation method

1. Select the asset whose depreciation method you want to change, and then go to Asset Detail.
2. Change the depreciation method for all federal tax books and any applicable state books. Check with each state’s Department of Revenue to determine whether they have adopted the 168 Allowance before switching to one of the "Plus 168" depreciation methods.

Note: Do not change any information in the Internal book.

A message warns you that changing the depreciation method affects the current depreciation amount and asking if you want to continue.

3. Select the Yes button. A message asks when you want to apply the change to the depreciation-critical field.
4. Select the Placed-in-Service Date option, and then select OK. All of the previously calculated depreciation amounts are cleared. This enables the application to correctly calculate the additional 168 Allowance.
5. Select 30, 40, 50, or 100 in the 168 Allowance % field if you have selected a "Plus 168" depreciation method.
6. Select the Save Asset button to save the asset.