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1065 returns

Organizational Expenses

This template summarizes the organizational expenses to be amortized, calculates the amortization expense, and produces a tracking schedule for amortizing the expense.  The taxpayer must timely elect to amortize the organization expenses. Otherwise, they will be capitalized and not amortized.  Entering account numbers for every expense item can generate a reclassifying entry.  If the input worksheet is completed, a journal entry is also generated to record the amortization expense.

Entering Information

All of the information needed to produce the calculations is entered on the Input worksheet. The yellow highlighted cells are calculated fields, and no data should be entered in these cells.  Any gray cells are not calculated fields, but data should not be entered in these cells.

 Enter the following information:

  • Amortization period elected (The default is 60 months, but can be overridden.)
  • 2004 Jobs Act election period (The default is 180 months, but  can be overridden.)
  • Date business began
  • First tax year (Enter the first tax year-end.)
  • Months in first tax year (This is calculated as the number of months from the business start date to the first tax year-end. The calculated number can be overridden.)
  • Expense type categories (Seven default categories are supplied, which can be edited.)
  • Expense type (Select from the drop-down menu.)
  • General ledger (GL) number [Required only if the journal entry is to be generated to reclassify expenses from detail accounts to an organizational expense (asset) account.]
  • Description/Date (This input is optional and is provided for information purposes only. Tracking the date that expenses are incurred may be beneficial when preparing the election to amortize the organizational expenses.
  • Amount of expense (Enter as either a Pre or Post 10/23/04 cost.)