What goes in the register
Include equipment, vehicles, furniture, computers above your threshold, leasehold improvements and buildings or land if you own them. Exclude small tools and supplies that you treat as expenses under your written policy. Decide the threshold with your preparer so that you are not recording pens and keyboards.
A short written policy, one paragraph, sets the rule. Staff then know when a purchase needs to be added.
Fields for each asset
A workable set of columns is asset number, description, serial number, location, vendor, purchase date, in-service date, cost, financing, business-use percentage, and the tax treatment your preparer chose. Add columns for disposal date, sale price and notes.
Give each item a unique number, and if it is practical, put a numbered label on the asset itself so you can match physical items to the list.
Tie the register to the books
The total cost on the register should equal the asset accounts in the balance sheet. Accumulated depreciation, if recorded in your books, should also agree with your preparer's schedule. Compare them at least yearly. Differences show unrecorded purchases, disposals or entries made in the wrong account.
Your accounting software may offer a fixed asset module, but a spreadsheet is enough for most small businesses.
Record disposals
When you sell, scrap, donate, lose or trade an asset, record the date and what you received. A sale can create a gain or a loss for tax purposes, and a forgotten disposal means you keep claiming depreciation on something you no longer own. Keep the bill of sale and any related documents.
Assets stolen or destroyed should have a police report or an insurance claim in the file.
Do an annual walk-through
Once a year, physically check the larger items against the list. Note missing, broken or relocated items and update locations. Review insurance coverage against the register, because underinsured equipment is a common surprise after a loss.
Save a dated copy of the register with your year-end records. In a sale of the business, the buyer will ask for it.
Using the register for insurance and sale
If a fire or theft occurs, a register with serial numbers and photos speeds up the claim and supports the values. When selling the business, the buyer will ask for a list of what is included, and a register provides it on the first day instead of the third week.
Keep a copy off-site or in the cloud so that it survives the same event that damages the equipment.
If you inherit a business with no register, start with what you can see. Walk the premises, photograph each major item and its serial plate, then match items to invoices in the old files. Mark unknown purchase dates as estimated and tell your preparer, who can advise how to handle the gaps.
Common questions
Is a fixed asset register required?
There is no single rule that requires one for every small business, but records supporting depreciation and disposals are needed, and a register is the easiest way.
Who maintains it?
Usually the owner or bookkeeper, with the preparer supplying tax treatment.
Should software-only businesses keep one?
If you own computers and furniture above your threshold, yes, even a short list helps.
This guide is general information, not tax, legal or accounting advice. Rules, fees and due dates change; check with the IRS, the NJ Division of Taxation or a licensed professional for your situation.