Church & Ministry Depreciation

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#1
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Are churches and other religious 501(c)(3) entities supposed to record depreciation on their books and report them on their 990? For example, a church spends 100k renovating a certain portion of the church for youth activities. Do they need to put that 100K on the books and depreciate it over 15 years like a for profit would?
 

#2
Joan TB  
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NPOs do not need to use MACRS. Most that I have seen use straight-line. But if MACRS is used, make sure the category selection is correct (the $100k renovation is probably not 15-year property). I don't think the NPO can use Sec 179 or bonus depreciation, unless the property is part of UBTI.

Of course, the $100k goes on their books - how would you have complete books without it?

Some NPOs may be required to show depreciation as part of their program costs to certain agencies or donors, for example, or if they have audited financial statements.
 

#3
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Joan TB wrote: f course, the $100k goes on their books - how would you have complete books without it?


Wasn't sure if it could go under an expense or if they could just book the asset without needing to record the depreciation
 

#4
Joan TB  
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For 990, you would record the asset, then depreciate. For true financial statements, ditto.

For a statement of cash receipts & disbursements, that would be different. (Note: I am not talking about cash-basis financial statements.)
 


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