it qualifies unless it meets one of the caveats for not qualifying
To qualify for the section 179 deduction, your property
must meet all the following requirements.
• It must be eligible property.
this includes tangible personal property ( the trusk) new or used does not matter
• It must be acquired for business use.
• It must have been acquired by purchase.
Property is not considered acquired by purchase in the following situations.
1. It is acquired by one component member of a control-led group from another component member of the same group.
2. Its basis is determined either:
a.In whole or in part by its adjusted basis in the hands of the person from whom it was acquired, or
b. Under the stepped-up basis rules for property ac-quired from a decedent.
3. It is acquired from a related person.
• It must not be property described later under What
Property Does Not Qualify.
Certain property does not qualify for the section 179 de-duction. This includes the following.
Land and Improvements
Land and land improvements do not qualify as section 179 property. Land improvements include swimming pools, paved parking areas, wharves, docks, bridges, and fences.
Even if the requirements explained earlier under What Property Qualifies? are met, you cannot elect the section 179 deduction for the following property.
•
Certain property you lease to others (if you are a non-corporate lessor).
•
Property used predominantly outside the United States, except property described in section 168(g)(4) of the Internal Revenue Code.
•
Property used by certain tax-exempt organizations, except property used in connection with the produc-tion of income subject to the tax on unrelated trade or business income.
•
Property used by governmental units or foreign per-sons or entities, except property used under a lease with a term of less than 6 months.
Leased property. Generally, you cannot claim a section 179 deduction based on the cost of property you lease to someone else. This rule does not apply to corporations. However, you can claim a section 179 deduction for the cost of the following property.
1. Property you manufacture or produce and lease to others.
2. Property you purchase and lease to others if both the following tests are met.
a.The term of the lease (including options to renew) is less than 50% of the property's class life.
b.For the first 12 months after the property is trans-ferred to the lessee, the total business deductions you are allowed on the property (other than rents and reimbursed amounts) are more than 15% of the rental income from the property.
