A couple of comments:
- Section 179 defines purchase as "....any acquisition of property..."
- A contribution of property is not an acquisition of property.
- Section 723 states that the basis of contributed property to a partnership by a partner shall be the adjusted basis of such property.
- So whatever the adjusted basis is at the time of contribution is what will be depreciated by the partnership; when transferred it is a step-into-the-shoes transaction. Same adjusted basis, same life and method of depreciation.
- My comments are assuming that the 2 member LLC will be taxed as a partnership
- Also, for future reference, keep in mind that Section 179 has taxable income limitations which can trip up taxpayers. This limitation applies at both the partnership and partner level.
*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.
