Thanks again for your reply.
I wrote, "In Turbotax, both the $44507 Section 179 expense and the $857 straight line 7 year depreciation expense are deducted". I was incorrect. Turbotax did not use S/L but MQ as the convention. Turbotax used a 7 year recovery period on the $24000 Section 179 disallowed portion of the truck cost, "MQ" as the convention and 200DB as the method to calculate $857 in depreciation in addition to the $34507 Section 179 write-off.
While on the subject of Section 179, what is "special depreciation", reported in Part II of Form 4562? Are there not enough methods of depreciation without calling one "special"?
In my form 4562, yet to be filed, Part V section A is blank. The Section 179 deduction appears in Part I. For the Form 4562, Line 12 Smart Worksheet
(A), Total Section 179 before limitation should be the total cost of the truck, $68507, but it is auto-filled as $34507, the amount I typed, and
(B) Section 179 allowable, if different is $34507.
It seems to me that the Turbotax generated entry for (A) is wrong, but maybe I am wrong. It seems I can use Section 179 to justify a deduction of any amount up to the entire cost as long as the cost is below $1,050,000 or the net profit of the business in which the asset is used, whichever is lower. Are this autofilled entry correct entries and if not do you know how to correct them? It seems that I cannot use Turbotax to change entries on forms, only on worksheets.
I guess that Turbotax would allow me to use Section 179 to deduct more than what the IRS would allow, which is the entirety of the profit for a business. Again, it is my understanding that a Section 179 deduction cannot exceed the net profit of the business in which the asset is used. Rather than calculating the maximum allowable Section 179 deduction, Turbotax seems to allow me to deduct in excess of the net profit and thereby show a loss, which I believe the IRS would disallow. Is my observation correct?
