The Fixed Asset Schedule provides a breakdown of all your fixed assets, balances, and depreciation. Fixed assets can be added and updated from the Fixed Asset page (under Accounts on the left side menu), and depreciation can also be entered on the fixed asset pages.

Lifespan/ Useful Life

This is the amount of time the asset is depreciated. Residential property is depreciated over a 27.5-year lifespan, and commercial property over 39 years. Non-property fixed assets, such as appliances, often have shorter useful lives in the 5 to 7-year time range.

Click here to learn more about asset class life and recovery periods.

Date Placed in Service

This refers to when the property was placed in service (for rental properties, this is the day it was listed for rent) or when a capital improvement was completed. Fixed assets are depreciated starting with their placed-in-service date, not the property purchase or project start date.

You will take a prorated amount of depreciation in the year the asset was placed in service. The proration amount is determined by the month the asset was placed in service.

Depreciable Basis

This is the portion of your total asset basis that is eligible to be depreciated. Buildings, Improvements, Capitalized Closing Costs, Capital Improvements, etc. all contribute to the depreciable basis of an asset.

Non-Depreciable Basis

This is the portion of your total asset basis that is not eligible to be depreciated. This is primarily applicable to property fixed assets, as land is not depreciable. The non-depreciable basis will not impact your depreciation expenses but is tracked for proper capital gains calculation whenever the property is sold.

Accumulated Depreciation

This is the total of the depreciation entries made for the asset. It reduces the asset's value on your books.

Book Value

The asset's book value is the depreciable basis plus the non-depreciable basis less any accumulated depreciation. The book value of an asset will decline over time as depreciation accumulates and is not the same as the asset's market value. The remaining depreciable basis is the depreciable basis less any accumulated depreciation.

Recommended Depreciation

This is a calculated value based on the information provided. Depreciation is calculated on a straight-line basis over the usable life of the asset.

If the Date Placed in Service has been filled out and it was in the reporting period, the amount will be prorated based on the mid-month convention. If no Date Placed in Service has been entered, or if the asset was placed in service prior to the reporting period, the full amount will be displayed. If no useful life was provided, no depreciation recommendation is given. Some assets may be eligible for accelerated or bonus depreciation; check with your tax advisor.

Depreciation expenses are not automatically booked on your behalf. Read more on how to book depreciation in REI Hub.