Eligible Section 179 Property

Forum|Forum|5 years ago
February 2, 2021
1 reply
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I have entered 4 assets but want to take the section 179 allowance as an expense for this year. The smart check continues to flag having the 'Yes' checkbox checked.

TurboTax Home & Biz Windows

Best answer by RayW7

Make sure the asset qualifies for a Section 179 deduction.

To qualify for a Section 179 deduction, the asset must be:

Tangible (you're able to touch it, which excludes intangible assets like patents or copyrights)
Purchased (not leased) for business use
Used more than 50% in your business
Placed in service (purchased, acquired, or converted to business use) during the current tax year
Acquired from a non-related party

The Section 179 deduction can't be claimed for business assets that were acquired in a tax-free exchange or from a person or entity with whom you share a close relationship as specified by the IRS.

You can't claim a Section 179 deduction for more than $1,040,000 in qualified assets. The deduction is reduced if the total of all Section 179 assets you placed in service during the tax year exceeds $2,590,000.

Your Section 179 deduction amount can't exceed your net business income for the year, but if it does, you can carry the excess over to a future tax year.

Finally, you must retain business use of the asset until the end of its useful life. If that isn't possible, you must pay back part of the deduction as a Section 179 recapture.

RayW7Answer

Level 12

Make sure the asset qualifies for a Section 179 deduction.

To qualify for a Section 179 deduction, the asset must be:

Tangible (you're able to touch it, which excludes intangible assets like patents or copyrights)
Purchased (not leased) for business use
Used more than 50% in your business
Placed in service (purchased, acquired, or converted to business use) during the current tax year
Acquired from a non-related party

The Section 179 deduction can't be claimed for business assets that were acquired in a tax-free exchange or from a person or entity with whom you share a close relationship as specified by the IRS.

Your Section 179 deduction amount can't exceed your net business income for the year, but if it does, you can carry the excess over to a future tax year.

Finally, you must retain business use of the asset until the end of its useful life. If that isn't possible, you must pay back part of the deduction as a Section 179 recapture.

deborah-iskandar

Level 2

When I entered the asset I elected not to claim section 179. But now I want to claim it, and Turbo Tax wont let me change my mind, even though I HAVE NOT FILED THE RETURN!

How can I make the election? I've tried to delete my file and re-enter it, but it still does not allow.

HR30

Level 2

To clarify do you have a business or rental property? It depends on the type of property/asset. While you cannot take Section 179 deduction for the residential rental property, itself, you can use Section 179 to deduct tangible, long-term personal property. This includes, for example, kitchen appliances, carpets, drapes, or blinds.

Date placed in service must be the current year
Select the option on the screens following your asset entry
Sample of the rental section is shown below.
Please provide additional information if you need further assistance and our tax experts can help.

@deborah-iskandar

In December 2021 I bought a new truck for business purposes, real estate property management. I am trying to take a section 179 deduction against the profit for one property and carry forward the remainder, the disallowed portion. It seems to meet the criteria for a section 179 deduction, being for business and costing less than the allowed limits. I expected the section 179 deduction to be allowed up to the profit for the property for 2021 and the remainder to be carried forward to 2022. Instead, I see no deduction. I have answered questions in various ways, do not know if I want "special depreciation" and cannot generate any deduction whatsoever, "0".