What is everyone doing to capture the depreciation expenses since there is no category for it in Stessa? Excel?
1 Like
@tammie.pmgr Not what youāre looking for but there is a subcategory called āNew Acquisitionā under Capital Expenses that might be able to suit your needs. It also doesnāt have a 39 year duration for commercial property/STR.
Only challenge is that it doesnāt spread out the depreciation that I believe everyone is looking for. Even though I offer a bookkeeping service for landlords, I actually let the CPA handle the tracking of that from year to year since their software does it so well. I find that the average owner also doesnāt record depreciation correctly (separating out land value as an example). Best of luck!
-Tom
2 Likes
Iām just trying to put the historical data from my Schedule Eās that CPA filed for me, depreciation expenses are listedā¦ 
1 Like
I at least want it to add historical Schedule E data, which includes depreciation expense.
I would love to see this feature. Would be very helpful.
Was this fixed? I still donāt see the depreciation line into Stessa P&L, but given they now offer a balance sheet, I would have thought this should be fixed by now. Am I missing something here?
1 Like
There should be an option to import the calculations done by tax software to have a complete P&L for accurate reporting and tracking. When I do a 1031 exchange I have to bring data from multiple sources together and Stessa should have a category for depreciation that we could use.
It would be great to have a proper Asset schedule to track depreciations, gains & losses on capitalized assets sold/retired before term.
It seems pretty easy: Stessa already has Transaction entries for Capital Expenses; āDescriptionā, āAmount,ā āCategoryā, āDate in Service,ā and āUseful lifeā.
Stessa should add āDate soldā, āAmount Soldā in the āCapital expense transactions.
All the information needed to create proper depreciation schedules will be captured. From there, the Depreciation expenses/gains or losses on disposal would flow through the financial reports (P&L, BS, SoCS)ā¦
Stessa is Great. That would be make it greater!
Thanks @Devin and team
1 Like
@devin and the team, if you can, please, add the expense category āDepreciationā to begin with - that would be a good first start, it will eliminate some of the manual reclasses from other categories where we reflect depreciation now to have a full picture of the portfolio. Thanks much!
1 Like
Iām not sure Iām following the logic of having a ādepreciationā category. Depreciation is an elective tax treatment for certain expenses that would already fall into one of many existing capital expenses categories. You would not want to record depreciation as an actual expense on the Transactions page.
I think what youāre really looking for is an option to apply a depreciation schedule (like MACRS, accelerated, Section 179, bonus, etc.) to an already categorized capital expense, yes?
Hi Devin,
Yes. I am looking for is an option to apply a depreciation schedule (like Straight line, MACRS, accelerated, Section 179, bonus, etc.) to an already categorized capital expense.
The choice should be made in the transaction when aquiring an asset.
It seems pretty easy: Stessa already has Transaction entries for Capital Expenses (should be rename Capital Expenditure) ; āDescriptionā, āAmount,ā āCategoryā, āDate in Service,ā and āUseful lifeā.
Stessa should add ādepreciation scheduleā (SL, MACR, Section 179ā¦)āDate soldā, āAmount Soldā in the āCapital expense transactions.
Depreciation is not "just an elective tax treatment for certain expenses.
Actually the IRS and 42 US states are prescriptive on the matter. They donāt let investors expense asset that need to be capitalized unless they qualify for the IRS Section 179. Meaning, there is a cash outflow at the time of acquisition (or repair of structure suck as plumbing/electrical), and a cashless expense over the prescribed life of the asset. Under IRS Section 179, qualifying assets can be expensed in the year of acquisition. Improvements and permanent structure (eg plumbing, electrical ā¦) donāt qualify.
Not only is the depreciation expense an operational expense useful for owners tracking the financial performance of their asset but also, it is needed to determine the gain or loss at the time of disposition of the asset, and the resulting effect on taxes.
I completely agree with what Patrick is saying above, Depreciation is an Expense (āpaperā expense). So, we need to show the depreciation Iām claiming every year on my Schedule E for the rental properties (based on the depreciation schedule of course)
For now, I have a separate depreciation schedule (based on MACR for example, for real property) in Excel and I manually make an entry to one of the Transactions categories in Stessa to be able to see the net P&L roll-up for each property after applying depreciation.
Plus, after the disposition of an asset, I want to see the depreciation I claimed over the years to be able to calculate the impact on taxes (exactly what patrickperigaud has described).
So, Stessa has a Capital Expense category, but itās a Balance Sheet category, the P&L impact is depreciation which is not shown anywhere unless we either post it manually to some other expense category or Stessa should post it automatically based on the input data in Capital Expense category (e.g. if I bought a property for $300k, put the acquisition date, input the depreciation years as 30, then each year Stessa should automatically (or semi-automatically) post the correct depreciation expense based on the input data and acquisition timing using MACR table).
Thanks for the replies! Iām going to sidestep the accounting conversation around what, when, and why certain types of depreciation might be appropriate over others as Stessa does not provide tax advice and we encourage everyone to consult a qualified CPA when making these decisions. My primary point above is that you would not typically categorize a new roof as simply āDepreciationā in Stessa (which offers a simplified cash-based transactions ledger) ā it still belongs under āCapital Expenses > New Roofā so you know what it is and can reference it accurately, even if you are depreciating the asset come tax time.
When it comes to depreciation schedules that we might provide for informational purposes, I do see the potential for substantial value there. That said, when weāve surveyed Stessa customers in the past about depreciation vs other potential new features, the most common answer has been something like, āWell, my CPA handles that so not sure I really need it baked into Stessa.ā
Iāll go ahead and merge this thread with other Wishlist threads related to depreciation so we can consolidate the conversation and better track the true level of support among Stessa customers.