Special Depreciation Allowance
Special Depreciation Allowance
- New 50% additional first-year special depreciation allowance applies to most new property purchased and placed in service after 2007.
- To be eligible, the property must be property with a recovery period of 20 years or less, off-the shelf computer software, qualified leasehold property, or water utility property. The special allowance does not apply if the ADS method is required.
- The taxpayer may elect out for any class of property.
- The allowance is figured after the section 179 deduction and before regular depreciation.
- If the special allowance applies, the limit on depreciation and section 179 deduction for automobiles is increased by $8,000.
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