Thanks for the additional details. I don't believe the items purchased qualify as unreimbursed partner expenses (UPE). A partnership agreement should include details as to when and what expenses will not be reimbursed. Generally these types of expenses are:
- Malpractice insurance
- Educational expenses
- Work clothes, etc.
What should happen in this case, is that the partnership should include a loan on the books, with interest, and pay this partner back. The other option is that the funds spent should be included in the partners equity contribution; which would change everyone's equity.
Regardless of the option chosen, the partnership would then be eligible for the depreciation.
Based on the facts, the items technically belong to the partnership, and as such, the partnership takes the depreciation.
These types of scenarios are not uncommon with small businesses, and are handled as noted above.
*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.
