Thank you for your answer. This is not my first year of business. When I selected straight depreciation and got to the end of my return, TT said that I had a medium risk of being audited because I used Schedule C and because my income was drastically reduced from prior years and because I have a home office. The only way that I could figure out what to do was to try all of the options available to see what consequences it had for my refund/tax owed. I ended up selecting Partial Section 179 with no special depreciation. I took $20,000 as a partial depreciation this year, and the rest will be depreciated over the next four years. This was the best option where I ended up owing the least tax to my state of California. It wasn't the biggest refund option, but my federal refund was close to the tax that I owed the state, which is satisfactory to me. The best part is that my overall income with my husband, since this is a joint return, remained about the same as last year, and Schedule C didn't factor in because the Standard Deduction was more than the amount of my deductions, and my risk of being audited went to low. I didn't get to take full advantage of the Qualified Business deduction of 20%, but I am looking forward to things like that in future years. My advice to others out there is the same as advice I got here, which is try all the possibilities to see what it does to the numbers. The straight special bonus depreciation would have been nice and given me the biggest refund on my Federal taxes but it also gave me the largest amount due to the state. That option would have given me another nice reduction in income the following year when the balance transferred over, but it would again put me at risk for an audit. It would have been nice to take advantage of this rare opportunity to expense it all at once, but the risk of audit isn't a chance that I want to take. Hope this helps someone.
