Fixing Missed Depreciation with Form 3115

Missed depreciation is one of the most common reasons tax professionals turn to Form 3115, Application for Change in Accounting Method. In this session, we’ll focus on how to fix depreciation issues using Form 3115, including when a method change is required, how to identify the affected assets and years, and how to compute and report the §481(a) adjustment. We’ll also cover the required statements and documentation supporting the change, with an emphasis on common missed depreciation situations, such as omitted assets from the depreciation schedule.

Objectives

Upon completion of this session, you will be able to:

• Identify depreciation errors that require Form 3115 rather than an amended return or a current year correction
• Determine which assets and prior year periods are included in the missed depreciation analysis
• Compute the §481(a) adjustment for common missed depreciation scenarios
• Determine how the §481(a) adjustment is reported on the return
• Prepare Form 3115 sections and required statements for a depreciation-related method change, including supporting schedules and attachments

CPE