The downside:
SEC179 deduction is not allowed for residential rental real estate.
The Special Depreciation allowance can have the potential to bite. Remember, all depreciation is recaptured and taxed in the tax year you sell the asset. That recaptured depreciation is added to your cost basis and can have the potential to bump you into the next higher tax bracket.
Now while recaptured depreciation is taxed at a max of 25%, it doesn't matter if you're already in the 24% or higher tax bracket. But if you're in the 12% tax bracket and the recaptured depreciation bumps your AGI over the threshold into the 22% tax bracket, then it is what it is.
If you have a 5 year asset that qualifies for the SDA or SEC179 and take it, then you sell the asset before you "would" have fully depreciated it using the MACRS schedule, having to recapture all that depreciation can bite you on the tax front.
In other words, what may save you a bit now, has the potential to bite you back many times over later when you have to recapture that depreciation. IT all comes down to timing and hoping nothing disastrous happens that would force an early recapture.
When it comes to rental property, I personally don't take any Special Depreciation Allowance on anything. That's because rental property almost always operates at a loss every single year anyway, on paper at tax filing time. So taking the SDA doesn't really provide any benefit to me, that I would not be paying more for later.
