How long to depreciate Semi Truck...

[Hamacher]

Can anyone tell me how long a Semi Truck gets depreciated? I have a new client that has a couple trucks. The previous preparer depreciated the older trucks over 3 years. That doesn't seem right to me.

Thanks in advance for your help.

[Bees Knees]

TTB, page 9-8, 3-year property, a) Tractor units for over-the-road use.

[Hamacher]

Thanks......

Perfect! Thanks for your help...

[ChEAr$]

truck life

And since three years is such a short time, chances are some depreciation might get
wasted. therefore I always go with at least five years, and sometimes, even seven.

Best to do an income forcast for seven years for all three useful lives before deciding,
and not to forget effect of any state income taxes.

[jainen]

Please explain

>>I always go with at least five years, and sometimes, even seven<<

Please explain your reasoning a little better, ChEAr$. It seems to me your ONLY choice under MACRS is either 3 years GDS or 4 years ADS.

[erchess]

I had always heard

that the IRS doesn't care how you do depreciation unless you try to claim fewer years than you are supposed to or try t claim more basis than you are supposed to. I have also been told that if an item of personal property was not on the abridged cladr tables with which we were provided, just call it seven year property.

On the other hand, I heard this message at two different firms that I left because I felt that they at times played things more fast and loose than I was comfortable with. (One of them was too conservative for my taste at other times, but that's another story.)

[Bees Knees]

And since three years is such a short time, chances are some depreciation might get
wasted. therefore I always go with at least five years, and sometimes, even seven.

Best to do an income forcast for seven years for all three useful lives before deciding,
and not to forget effect of any state income taxes.

The ability to pick your own class life hasn't been available since 1980. Your only choice is the GDS life under MACRS, or elect the ADS life and use straight line depreciation.

[Bees Knees]

On the other hand, I heard this message at two different firms that I left because I felt that they at times played things more fast and loose than I was comfortable with.

I just watched the Enron story on PBS. Seems the oldest and largest accounting firm in the nation gave the OK to use Mark to Market accounting to book profits based on a future guess as to what their profit might be while their cash flow was showing consistent losses each year. Allot of guys are now in prison, some are dead, the accounting firm is no more, and thousands of employees lost their pensions.

Follow the rules and use the correct depreciation life.

[erchess]

That reminds me...

I think it was in 04 or 05 I took an Ethics for EAs course from PES and the author turned out to be a former Director of Tax at Arthur Anderson. The blurb didn't say how long ago the person had that job nor how many people at Arthur Anderson held that title at the same time. (In other words was this guy over one local office, the whole nationwide firm, or somewhere in between?) Anyway, in my course evaluation I suggested that PES hire Ken Lay to write a course on general business ethics or ethics for CEOs. I got no response, so I guess PES doesn't have my sense of humor.

[ChEAr$]

Right

The ability to pick your own class life hasn't been available since 1980. Your only choice is the GDS life under MACRS, or elect the ADS life and use straight line depreciation.

And that's what I'm talking about.

[jainen]

what I'm talking about

>>that's what I'm talking about<<

Please explain your reasoning a little better, ChEAr$. It seems to me your ONLY choice under MACRS is either 3 years GDS or 4 years ADS.