CCH Axcess Tax

AMT/ACE Life

The "AMT/ACE Life" is the ADS life as defined in IRC Section 56(a)(1) and is used to compute Alternative Minimum Tax depreciation. For Form 1120 and Form 1065 returns, "Adjusted Current Earnings (ACE)" depreciation amounts are also calculated using this entry. The MACRS depreciation adjustment is the difference between regular and AMT depreciation. This adjustment carries to the AMT/ACE or AMT report and to Form 4626 or Schedule K.

Assets placed in service after December 31, 1998:

If no entry is present, the standard recovery period (MACRS life) will be used for AMT calculations. Therefore, the only AMT adjustment will be the difference between MACRS 3-, 5-, 7-, and 10-year property using the 200% declining balance method and ADS using the 150% declining balance method.

Assets placed in service before January 1, 1999:

Alternative Minimum Tax on MACRS personal property is computed using the 150 percent declining balance method, changing to straight line when advantageous, over the life entered in this field.

For MACRS real property, AMT depreciation is computed using the straight line method over 40 years. An entry is not necessary for MACRS real property.

For pollution control facilities, enter the "AMT Life" in months.

If no entry is present, the following ADS life is assumed, based on the class life entered in "Life/Rate":

MACRS	ADS Assumption	ACRS	ADS Assumption
3-Year	3 Years	3-Year	5 Years SL (Half year Conv.)
5-Year	5 Years	5-Year	8 Years SL (Half year Conv.)
7-Year	10 Years	10-Year	15 Years SL (Half year Conv.)
10-Year	16 Years	15-Year	15 Years SL (No Conv.)
15-Year	20 Years	18-Year	18 Years SL (No Conv.)
20-Year	25 Years	18-Year*	18 Years SL (Mid month Conv.)
25-Year	50 Years	19-Year*	19 Years SL (Mid month Conv.)
27.5-Year	40 Years
31.5-Year	40 Years
39-Year	40 Years
Note: For real property ACRS assets, the assumed life for the ACE depreciation computation is 40 years.

* based on date placed in service

Indian Reservation Property (Pre-2018 Assets Only)

The accelerated Alternative Minimum Depreciation will be calculated using the same Accelerated Recovery Period as used to calculate regular depreciation. No additional entries are necessary.