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Allocation

Allocate an asset individually (section 754)

Section 754 election (step up in basis)
Section 754 lets a partnership choose to adjust the basis of partnership assets. This is often called a step up in basis, and requires individual assets to be allocated.
Do the following to allocate an asset individually:
  1. Select the business activity folder
    Income & Deductions
    ,
    Farm
    ,
    Farm Rental
    ,
    Schedule K
    , or
    Rent & Royalty
    .
  2. Select
    Asset
     to open the UltraTax CS asset module.
    note
    If the Asset tab isn't available, the client is set up for entering summary asset information instead of detailed asset information. To enter detailed asset information and enable the asset module, select
    File
    , 
    Client Properties
    ,
    Advanced Properties
    ,
    Enter Asset Detail
    , then mark the
    Enter asset detail information
     checkbox.
    Detail vs. Summary Asset Data Entry:
     You have 2 options to enter asset data. You can enter detailed asset information in the built-in asset module, or you can enter summary asset information on certain input screens. UltraTax CS automatically calculates and transfers data entered in the asset module to the appropriate tax forms. Detailed asset data entry is the application default. To enter summary asset information for the open client, select
    File
    ,
    Client Properties
    ,
    Advanced Properties
    ,
    Enter Asset Detail
    , then clear the
    Enter asset detail information
     checkbox.
  3. Select
    Setup
    , then
    1065 Allocation
     to open the
    Partnership Allocation
     window to select the existing Individually Allocated group.
  4. Select
    Individually Allocated item
     in the
    Partnership Allocation
     window.
  5. Select
    Edit
    , then
    Select Assets
     to open the
    Select Assets - Individually Allocated
     window.
  6. Select the asset to allocate and select
    OK
    .
  7. Select
    Enter Special Allocations
     to open the
    Select Individually Allocated Asset
     window.
  8. Select the asset you want to allocate then select
    Continue
    .
  9. Enter the partner allocations for the current depreciation and AMT adjustment for the federal return and any attached states, as needed.
    note
    You can enter a partial percentage or amount of the allocation then select
    Distribute
     to distribute the remaining percentage or amount equally or pro rata to selected partners.
  10. Select
    OK
    , then select
    Done
     to return to the
    Asset List
     window. Each asset allocated using the Individually Allocated group is listed separately in the Allocation list in the Allocations window in Partner Data Entry, using the asset's description.

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