Section 179 - using car at lower percentage than previous years

[patmag]

Hello. I am filing a 2019 tax return for my S Corp. I have two cars titled and registered as personal (not business), one car is mainly used for business related trips. It was financed until mid 2019 when I paid it off, the loan was under my name, not the company. 

I am at Deductions - Business Asset Summary (Form 4562). My CPA listed that car as an asset with 100% business usage on previous tax returns. I used the car more like 80-90% for business related trips, but I want to add it as 70% just in case. If I change the percentage, it changes the Depreciation and AMT numbers. Should I manually change the numbers for previous years or is it okay to put in amounts different than prior years?

[patmag]

I am at Deductions - Business Asset Summary (Form 4562). My CPA listed that car as an asset with 100% business usage on previous tax returns. I used the car more like 80-90% for business related trips, but I want to add it as 70% just in case. If I change the percentage, it changes the Depreciation and AMT numbers. Should I manually change the numbers for previous years or is it okay to put in amounts different than prior years?

[Irene2805 · Accepted solution]

Leave the numbers for previous years as they are--that is the amount of depreciation you took.  It's OK to have a change in percentage of business use.

[patmag]

The car was purchased for $11833 on 03/2017. So for example, my 2018 asset details are Current Depreciation $3787, Current AMT $3017 and for 2017 it was Depreciation $2367 and AMT $1775.

But when I change the percentage to 70% it changes prior amounts as well. Should I then move to the next step and select the option saying that the numbers do not match my records and then type in the amount of all prior years depreciation as $6154 (2017+2018 depreciation numbers)

If I do that, it would bring my current depreciation down to $852. With 100% it would be $1775 .

[MaryK4 · Accepted solution]

Yes, you must enter the adjustments- the reduced amount you see is correct using the 70%.  

@patmag