Since long term residential rental property almost always operates at a loss on paper, at tax filing time, I find taking either the SEC179 or SDA to be a waste, as it makes no difference in the tax liability unless you actually show a profit on the SCH E in the year you take the SEC179 or SDA. But like I said, showing a profit on long term residential rental property on the SCH E is not very common at all.
It seems the software should have recommended depreciation over useful life of the system rather than disallowing the section 179 deduction.
When you first enter an asset, the program will assume regular depreciation, and if the asset qualifies for SEC179 the program will ask you if you want to take that option. If you take that option, the SEC 179 appears on the 4562 that prints in landscape format, titled "Depreciation and Amortization Report" under the "Section 179" column. The amount will appear under that column every single year. Just be aware it's only "taken/deducted" in the first year you took it.
Depending on one's specific and explicit situation, the SEC179 deduction may or may not appear on the other 4562 titled "Alternative Minimum Tax Depreciation Report".
As for carry overs, they are on the IRS Form 8582. The 8582 is only produced if you actually have any PAL carry overs. You may, or may not since the allowance of up to a 25K deduction of passive income against other ordinary income, if conditions are met.
