If you take the Special Depreciation Allowance, it will decrease your basis. If and when you sell the property, you may have to "recapture" the excess deprecation that you took. Recaptured deprecation is taxed as ordinary income. Some people don't want to have that situation in the future and prefer to elect not to take the allowance.
However, if you take the Special Depreciation Allowance, creating a loss, it will carry-forward to next year as a disallowed passive activity loss. (This is because of the passive activity loss limitation for incomes over $150K, as I'm sure you know). You can use the loss next year to offset a profit on the rental. The loss will continue to carry-forward until it is used up. If you expect profits and prefer to offset the profits in future years, you should choose this.
