Posted 2025 0224

Depreciation asset #4: You have elected Section 179 for this automobile in a prior year. Under Revenue Procedure 2019-13 this asset will not be applied the safe harbor.  No Federal depreciation is allowed until year 7 of the asset. State depreciation will not be affected you must make any state adjustments for this asset if applicable. Consider amending your prior year tax return to remove Section 179 and use additional first year depreciation (bonus).

 

Why would it be a benefit to amend prior years?

Note: the asset was purchased in 2019. When I took this client from another CPA in 2021, there was no depreciable basis.