6.1 Introduction

The IRS places limits on the amount of depreciation that can be taken annually on some kinds of assets. In these cases, the maximum annual depreciation allowed depends on when the asset was purchased, and the year of depreciation. The menu selection Depreciation Limits, under the Select, Fixed Assets menu, allows you to enter into the system depreciation limits and the years they apply to. A separate limit table is entered for each set of annual limit amounts.

Before entering assets that are subject to limits, in the fixed asset master file, you must enter the appropriate annual limits on on the Depreciation Limits form. The first part of the form is shown below.

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