- Federal tax payable - If the box Accrue federal tax (Screen 3, code 11) is checked, the program adjusts the entry made in Federal tax payable (Screen 29, code 253) based on the outcome of the tax return. If not accruing federal income tax, the amount enter in Federal tax payable (Screen 29, code 253) carries to Schedule L, and isn't adjusted.
- State tax payable - If the box is Accrue state option 1 (Screen 3.1, Code 50) or Accrue state option 2 (Screen 3.1, code 51), the program adjusts the entry made in Ending - State tax payable (Screen 29, code 254) based on outcome of the tax return. If not accruing state income tax, the amount entered in Ending - State tax payable (Screen 29, code 254) carries to Schedule L, line 18 and isn't adjusted.
- Ending retained earnings - Lacerte calculates ending retained Earnings on Schedule L, Line 24 in the following manner:
Beginning retained earnings, Sch. L, Line 24, column (b):
+ Net income per books, Schedule M-1, Line 1
+ Additions to Other retained earnings (Screen 32, code 114)
+ AAA Other additions to carry to Sch. L (Screen 32, code 105)
- Distributions from AAA, Schedule M-2, Line 7, column (a)
- Distributions from OAA, Schedule M-2, Line 7, column (b)
- Distributions from PTI, Schedule M-2, Line 7, column (c)
- Dividend Distributions from accumulated E&P, Sch. K, Line 22
- Distributions in excess of Schedule M-2/E&P accounts
- Reductions to Other retained earnings (Screen 32, code 115)
- AAA Other reductions to carry to Sch. L (Screen 32, code 106)
= Ending Retained Earnings, Sch. L, Line 24, column (d)
Entries made in Other additions and Other reductions to the Accumulated Adjustment Account (Screen 32, codes 102 and 103) don't automatically carry to Ending Retained Earnings on Schedule L. The AAA isn't a reconciliation of beginning to ending retained earnings. Amounts entered in Amount of other additions to carry to Schedule L (Screen 32, code 105) and Amount of other reductions to carry to the Schedule L (Screen 32, code 106) will be included in calculating ending retained earnings.
If the total ending balance of Schedule M-2 doesn't equal the ending balance of Retained Earnings on Schedule L, the program automatically generates a worksheet reconciling the difference between Schedule M-2 and Schedule L. The ending retained earnings can be overridden in Ending - Total retained earnings [O] (Screen 29, code 266).