alternative minimum tax depreciation

Calculating Depreciation For Your Investments
Investing in real estate? Thinking about buying new equipment for your business? The depreciation you take on your tax return can turn into a significant tax benefit. But you need to make some complex calculations. Fortunately, Microsoft Excel can help.

Excel’s VDB function calculates declining balance depreciation for an asset given the cost, its salvage value, estimated economic life, the starting accounting period and the ending accounting period for which depreciation is being calculated, the factor at which the balance declines, and, optionally, a switch-to-straight-line switch which is set to either TRUE or FALSE. If you set this switch to TRUE, Excel doesn’t switch to straight-line at the point when straight-line depreciation exceeds declining balance depreciation. If you set this value to FALSE, Excel does switch to straight-line. If you don’t set the optional switch-to-straight-line switch to TRUE, Excel sets this value to FALSE.

Note: By default, US tax laws do convert to straightline depreciation at the point that straightline depreciation exceeds declining balance deprecation. But back to the mechanics of the VBD function…

The VDB function uses the following syntax:

VBD(cost,salvage,life,start-period,end-period,factor,switch)

Suppose, for example, that you must calculate 150% declining balance depreciation for equipment that costs $50,000, lasts five years, and will have a salvage value of $10,000 at the end of the fifth year. To calculate the depreciation for the first year, you use the following formula:

=VBD(50000,10000,5,0,1,150%)

The function returns the value 15000.00. Notice that to calculate depreciation for the first year, you set the start period to 0 and the end period to 1. To calculate the depreciation for the second year, you use the formula

=VBD(50000,10000,5,1,2,150%)

The function returns the value 10500.00. Notice that to calculate the depreciation for the second year, you set the start period to 1 and the end period to 2. In both of the two preceding examples, Excel will automatically switch to straight-line depreciation at the point when straight-line depreciation for a period exceeds declining balance depreciation. To instruct Excel not to make this switch, you would use the following formula to calculate depreciation for the first year:

-VBD(50000,10000,5,0,1,150%,TRUE)

The word TRUE, which Excel interprets as 1, tells Excel not to switch to straight-line. To instruct Excel not to make this switch in the second year, you would use the following formula to calculate depreciation:

=VBD(50000,10000,5,1,2,150%,TRUE)

alternative minimum tax depreciation

alternative minimum tax democrats

Democratic Budget - PAYGO EQUALS PAYMORE!!
The Democrats promised to balance the budget by 2012. They said they will do this by finding “$900 billion in additional revenues.”

Translation-TAX INCREASES!!

They would let the recent tax cuts expire in 2010. This means among other things bringing back the marriage penalty tax and cutting the child tax credit in half.

Democrats want you to believe that they intend to slow the growth in spending. They are using their usual deception with the term PAYGO. No matter how glib their wording, the reality is that PAYGO will become PAYMORE.

Little would be done to curb welfare and other entitlements which are soaring. The average family would see a tax increase of $2641 per year.

A family of four earning $50,000 would see taxes go up 132 percent. A single parent with two children earning $30,000 would see taxes raised 67 percent, according to Senate Minority Leader Mitch McConnell, if the president’s tax relief is not made permanent.

Some Democrats blame it on the war. Total defense spending takes 4% of GDP. Defense spending as a percent of GDP is a tick away from its lowest point in 50 years.

Democrats are simply being Democrats. They’re trying to get their hands on every penny they can to redistribute, mostly to non-producers.

To implement PAYGO, tax cuts must be offset by tax increases elsewhere or with cuts in entitlement spending, which would be helpful if those cuts applied to all entitlements.

Instead, Democrats stayed away from entitlements already in place, which have huge future costs.

Since the 2001-2003 tax cuts, revenues have soared and continue to do so. With revenues pouring in to the Treasury, no legitimate argument can be made for tax increases.

How about the economy? March 2007 produced another sizable jump in new jobs as did worker gains. When workers gain as they have for the last two years, the job market usually remains tight, signaling more good news ahead.

PAYGO may sound good, but it has the potential for much harm.

Hopefully Americans will tell congress to put a healthy economy and job creation ahead of partisan politics.

alternative minimum tax democrats