Filing Your Taxes Online is Fast, Easy and Secure.
Start now and receive your tax refund in as little as 7 days.

1. Get Answers

Your online questions are customized to your unique tax situation.

2. Maximize your Refund

Find tax credits for everything from school tuition to buying a hybri

3. E-File for FREE

E-file free with direct deposit to get your refund in as few as 7 days.

Filing your taxes with paper mail can be difficult and it could take weeks for your refund to arrive. IRS e-file is easy, fast and secure. There is no paperwork going to the IRS so tax refunds can be processed in as little as 7 days with direct deposit. As you prepare your taxes online, you can see your tax refund in real time.

FREE audit support and representation from an enrolled agent – NEW and only from H&R Block

Snaptax

Vita Tax Locations1040 Form 2011Filing Taxes For 2013Irs Tax Return Forms 2011File My 2012 Taxes For FreeFile 2006 Tax ReturnIrs EfileTaxes And Unemployment1040ez 2012 FormTurbo Tax File 20122008 1040x2011 Free Tax FileFile 1040x ElectronicallyInstructions For Form 1040ezState Tax Forms FreeTax Return FormNonresidents State Tax FormsSoftware For 1040nrE File 1040nrHr Block 2011 Tax SoftwareHow To Prepare An Amended Tax Return2011 Tax ReturnTaxslayer ComMilitary Tax FormFree File 2011 TaxesCan I File 1040x Online1040ez 2011 InstructionsFile Amended Tax Return 20112012 Tax Return FilingFree Tax Filing Online For MilitaryFree Filing Of State TaxesHow To Fill Out Amended Tax ReturnHow Do I File Last Year's Taxes 20112012 Form 1040 Schedule AW2 Ez FormTax Form 1040nr Ez1040esState Tax Return 2013Free Online Federal And State Tax Filing 20131040ez Efile Free

Snaptax

Snaptax Index A Accrual period, Accrual period. Snaptax Acquisition premium, Acquisition premium. Snaptax Adjusted issue price, Adjusted issue price. Snaptax Assistance (see Tax help) B Backup withholding, Backup Withholding Bearer bonds and coupons, Bearer Bonds and Coupons Brokers (see Information for brokers and other middlemen) C Certificates of deposit, Certificates of Deposit Comments and suggestions, Comments and suggestions. Snaptax Contingent payment debt instruments, Contingent Payment Debt Instruments D Debt instrument, Debt instrument. Snaptax Debt instruments Long-term, Long-Term Debt Instruments Short-term, Short-Term Obligations Redeemed at Maturity Debt instruments and coupons purchased after 1984, Debt Instruments and Coupons Purchased After 1984 Debt instruments and coupons purchased after July 1, 1982, and before 1985, Debt Instruments and Coupons Purchased After July 1, 1982, and Before 1985 Debt instruments issued after 1954, corporate, Corporate Debt Instruments Issued After 1954 and Before May 28, 1969, and Government Debt Instruments Issued After 1954 and Before July 2, 1982 Debt instruments issued after 1984, Debt Instruments Issued After 1984 Debt instruments issued after July 1, 1982, Debt Instruments Issued After July 1, 1982, and Before 1985 Debt instruments issued after May 27, 1969, corporate, Corporate Debt Instruments Issued After May 27, 1969, and Before July 2, 1982 Debt instruments not on the OID list, Debt Instruments Not on the OID List Debt Instruments on the OID list, Debt Instruments on the OID List Definitions, Definitions Accrual period, Accrual period. Snaptax Acquisition premium, Acquisition premium. Snaptax Adjusted issue price, Adjusted issue price. Snaptax Debt instrument, Debt instrument. Snaptax Issue price, Issue price. Snaptax Market discount, Market discount. Snaptax Original issue discount (OID), Original issue discount (OID). Snaptax Premium, Premium. Snaptax Qualified stated interest, Qualified stated interest. Snaptax Stated redemption price at maturity, Stated redemption price at maturity. Snaptax Yield to maturity, Yield to maturity (YTM). Snaptax E Electronic payee statements, Electronic payee statements. Snaptax F Form 1099-OID, Form 1099-OID. Snaptax Free tax services, Free help with your tax return. Snaptax H Help (see Tax help) I Inflation-indexed debt instruments, Inflation-Indexed Debt Instruments Information for brokers and other middlemen, Information for Brokers and Other Middlemen Information for owners of OID debt instruments, Information for Owners of OID Debt Instruments Issue price, Issue price. Snaptax Issuers of OID debt instruments, Instructions for, Instructions for issuers of OID debt instruments. Snaptax L Long-term debt instruments, Long-Term Debt Instruments M Market discount, Market discount. Snaptax O OID list, Debt Instruments on, Debt Instruments on the OID List OID on long-term debt instruments, figuring, Figuring OID on Long-Term Debt Instruments OID on stripped bonds and coupons, figuring, Figuring OID on Stripped Bonds and Coupons OID, figuring, Figuring OID. Snaptax Using section I, Using Section I. Snaptax Using the income tax regulations, Using the income tax regulations. Snaptax Original issue discount (OID), Original issue discount (OID). Snaptax Owners of OID debt instruments, information for, Information for Owners of OID Debt Instruments P Premium, Premium. Snaptax Publications (see Tax help) Q Qualified stated interest, Qualified stated interest. Snaptax R REMIC and CDO information reporting requirements, REMIC and CDO information reporting requirements. Snaptax S Section I, Section I. Snaptax Section II, Section II. Snaptax Section III, Section III. Snaptax Short-term obligations redeemed at maturity, Short-Term Obligations Redeemed at Maturity Stated redemption price at maturity, Stated redemption price at maturity. Snaptax Stripped bonds and coupons, figuring OID, Figuring OID on Stripped Bonds and Coupons Suggestions, Comments and, Comments and suggestions. Snaptax T Tax help, How To Get Tax Help Y Yield to maturity, Yield to maturity (YTM). Snaptax , Yield to maturity (YTM). Snaptax Prev  Up     Home   More Online Publications
Español

Better Business Bureaus (BBBs) are nonprofit organizations that encourage honest advertising and selling practices and are supported primarily by local businesses. They offer a variety of consumer services, including consumer education materials; business reports, particularly unanswered or unsettled complaints or other problems; mediation and arbitration services; and information about charities and other organizations that are seeking public donations. They also provide ratings (A, B, C, D, or F) of local companies to express the BBB's confidence that the company operates in a trustworthy manner and demonstrates a willingness to resolve customer concerns.

Baltimore, MD

Website: Better Business Bureau

Address: Better Business Bureau
502 S. Sharp St., Suite 1200
Baltimore, MD 21201

Phone Number: 410-347-3990

The Snaptax

Snaptax 3. Snaptax   Claiming the Special Depreciation Allowance Table of Contents Introduction What Is Qualified Property?Qualified Reuse and Recycling Property Qualified Cellulosic Biofuel Plant Property Qualified Disaster Assistance Property Certain Qualified Property Acquired After December 31, 2007 Election to Accelerate Certain Credits in Lieu of the Special Depreciation Allowance How Much Can You Deduct? How Can You Elect Not To Claim an Allowance? When Must You Recapture an Allowance? Introduction You can take a special depreciation allowance to recover part of the cost of qualified property (defined next), placed in service during the tax year. Snaptax The allowance applies only for the first year you place the property in service. Snaptax For qualified property placed in service in 2013, you can take an additional 50% special allowance. Snaptax The allowance is an additional deduction you can take after any section 179 deduction and before you figure regular depreciation under MACRS for the year you place the property in service. Snaptax This chapter explains what is qualified property. Snaptax It also includes rules regarding how to figure an allowance, how to elect not to claim an allowance, and when you must recapture an allowance. Snaptax Corporations can elect to accelerate certain minimum tax credits in lieu of claiming the special depreciation allowance for eligible qualified property. Snaptax See Election to Accelerate Certain Credits in Lieu of the Special Depreciation Allowance , later. Snaptax See chapter 6 for information about getting publications and forms. Snaptax What Is Qualified Property? Your property is qualified property if it is one of the following. Snaptax Qualified reuse and recycling property. Snaptax Qualified cellulosic biofuel plant property. Snaptax Qualified disaster assistance property. Snaptax Certain qualified property acquired after December 31, 2007. Snaptax The following discussions provide information about the types of qualified property listed above for which you can take the special depreciation allowance. Snaptax Qualified Reuse and Recycling Property You can take a 50% special depreciation allowance for qualified reuse and recycling property. Snaptax Qualified reuse and recycling property is any machinery or equipment (not including buildings or real estate), along with any appurtenance, that is used exclusively to collect, distribute, or recycle qualified reuse and recyclable materials (as defined in section 168(m)(3)(B) of the Internal Revenue Code). Snaptax Qualified reuse and recycling property also includes software necessary to operate such equipment. Snaptax The property must meet the following requirements. Snaptax The property must be depreciated under MACRS. Snaptax The property must have a useful life of at least 5 years. Snaptax The original use of the property must begin with you after August 31, 2008. Snaptax You must have acquired the property by purchase (as discussed under Property Acquired by Purchase in chapter 2 ) after August 31, 2008, with no binding written contract for the acquisition in effect before September 1, 2008. Snaptax The property must be placed in service for use in your trade or business after August 31, 2008. Snaptax Excepted Property Qualified reuse and recycling property does not include any of the following. Snaptax Any rolling stock or other equipment used to transport reuse or recyclable materials. Snaptax Property required to be depreciated using the Alternative Depreciation System (ADS). Snaptax For other property required to be depreciated using ADS, see Required use of ADS under Which Depreciation System (GDS or ADS) Applies , in chapter 4 . Snaptax Other bonus depreciation property to which section 168(k) of the Internal Revenue Code applies. Snaptax Property for which you elected not to claim any special depreciation allowance (discussed later). Snaptax Property placed in service and disposed of in the same tax year. Snaptax Property converted from business use to personal use in the same tax year acquired. Snaptax Property converted from personal use to business use in the same or later tax year may be qualified reuse and recycling property. Snaptax Qualified Cellulosic Biofuel Plant Property You can take a 50% special depreciation allowance for qualified cellulosic biofuel plant property. Snaptax Cellulosic biofuel is any liquid fuel which is produced from any lignocellulosic or hemicellulosic matter that is available on a renewable or recurring basis. Snaptax Examples include bagasse (from sugar cane), corn stalks, and switchgrass. Snaptax The property must meet the following requirements. Snaptax The property is used in the United States solely to produce cellulosic biofuel. Snaptax The original use of the property must begin with you after December 20, 2006. Snaptax You must have acquired the property by purchase (as discussed under Property Acquired by Purchase in chapter 2 ) after December 20, 2006, with no binding written contract for acquisition in effect before December 21, 2006. Snaptax The property must be placed in service for use in your trade or business or for the production of income after October 3, 2008, and before January 3, 2013. Snaptax Note. Snaptax For property placed in service after January 2, 2013, and before January 1, 2014, you can take a 50% special depreciation allowance for qualified second generation biofuel plant property that is used solely in the United States to produce second generation biofuel (as defined in section 40(b)(6)(E)). Snaptax The other requirements for qualified second generation biofuel plant property to be eligible for the special depreciation allowance are identical to the requirements discussed for Qualified Cellulosic Biofuel Plant Property above. Snaptax Special Rules Sale-leaseback. Snaptax   If you sold qualified cellulosic biofuel plant property you placed in service after October 3, 2008, and leased it back within 3 months after you originally placed it in service, the property is treated as originally placed in service no earlier than the date it is used by you under the leaseback. Snaptax   The property will not qualify for the special allowance if the lessee or a related person to the lessee or lessor had a written binding contract in effect for the acquisition of the property before December 21, 2006. Snaptax Syndicated leasing transactions. Snaptax   If qualified cellulosic biofuel plant property is originally placed in service by a lessor after October 3, 2008, the property is sold within 3 months of the date it was placed in service, and the user of the property does not change, then the property is treated as originally placed in service by the taxpayer no earlier than the date of the last sale. Snaptax   Multiple units of property subject to the same lease will be treated as originally placed in service no earlier than the date of sale if the property is sold within 3 months after the final unit is placed in service and the period between the times the first and last units are placed in service does not exceed 12 months. Snaptax Excepted Property Qualified cellulosic biofuel plant property does not include any of the following. Snaptax Property placed in service and disposed of in the same tax year. Snaptax Property converted from business use to personal use in the same tax year it is acquired. Snaptax Property converted from personal use to business use in the same or later tax year may be qualified cellulosic biomass ethanol plant property. Snaptax Property required to be depreciated using the Alternative Depreciation System (ADS). Snaptax For other property required to be depreciated using ADS, see Required use of ADS under Which Depreciation System (GDS or ADS) Applies , in chapter 4 . Snaptax Property any portion of which is financed with the proceeds of any obligation the interest on which is exempt from tax under section 103 of the Internal Revenue Code. Snaptax Property for which you elected not to claim any special depreciation allowance (discussed later). Snaptax Property for which a deduction was taken under section 179C for certain qualified refinery property. Snaptax Other bonus depreciation property to which section 168(k) of the Internal Revenue Code applies. Snaptax Qualified Disaster Assistance Property You can take a 50% special depreciation allowance for qualified disaster assistance property placed in service in federally declared disaster areas in which the disaster occurred in 2009. Snaptax A list of the federally declared disaster areas is available at the FEMA website at www. Snaptax fema. Snaptax gov. Snaptax Your property is qualified disaster assistance property if it meets the following requirements. Snaptax The property is nonresidential real property or residential real property placed in service before January 1, 2014, in a federally declared disaster area in which the disaster occurred in 2009. Snaptax You must have acquired the property by purchase (as discussed under Property Acquired by Purchase in chapter 2 ) on or after the applicable disaster date, with no binding written contract for the acquisition in effect before the applicable disaster date. Snaptax The property must rehabilitate property damaged, or replace property destroyed or condemned, as a result of the applicable federally declared disaster. Snaptax The property must be similar in nature to, and located in the same county as, the rehabilitated or replaced property. Snaptax The original use of the property within the applicable disaster area must have begun with you on or after the applicable disaster date. Snaptax The property is placed in service by you on or before the date which is the last day of the fourth calendar year. Snaptax Substantially all (80% or more) of the use of the property must be in the active conduct of your trade or business in a federally declared disaster area, occurring in 2009. Snaptax It is not excepted property (explained later in Excepted Property ). Snaptax Special Rules Sale-leaseback. Snaptax   If you sold qualified disaster assistance property you placed in service after the applicable disaster date and leased it back within 3 months after you originally placed it in service, the property is treated as originally placed in service no earlier than the date it is used by you under the leaseback. Snaptax   The property will not qualify for the special allowance if the lessee or a related person to the lessee or lessor had a written binding contract in effect for the acquisition of the property before the applicable disaster date. Snaptax Syndicated leasing transactions. Snaptax   If qualified disaster assistance property is originally placed in service by a lessor after the applicable disaster date, the property is sold within 3 months of the date it was placed in service, and the user of the property does not change, then the property is treated as originally placed in service by the taxpayer no earlier than the date of the last sale. Snaptax   Multiple units of property subject to the same lease will be treated as originally placed in service no earlier than the date of sale if the property is sold within 3 months after the final unit is placed in service and the period between the times the first and last units are placed in service does not exceed 12 months. Snaptax Excepted Property Qualified disaster assistance property does not include any of the following. Snaptax Property required to be depreciated using the Alternative Depreciation System (ADS). Snaptax For other property required to be depreciated using ADS, see Required use of ADS under Which Depreciation System (GDS or ADS) Applies , in chapter 4 . Snaptax Property any portion of which is financed with the proceeds of a tax-exempt obligation under section 103 of the Internal Revenue Code. Snaptax Any qualified revitalization building (defined later) placed in service before January 1, 2010, for which you have elected to claim a commercial revitalization deduction for qualified revitalization expenditures. Snaptax Any property used in connection with any private or commercial golf course, country club, massage parlor, hot tub facility, suntan facility, or any store, the principal business of which is the sale of alcoholic beverages for consumption off premises. Snaptax Any property for which the special allowance under section 168(k) or section 1400N(d) of the Internal Revenue Code applies. Snaptax Property for which you elected not to claim any special depreciation allowance (discussed later). Snaptax Property placed in service and disposed of in the same tax year. Snaptax Property converted from business use to personal use in the same tax year acquired. Snaptax Property converted from personal use to business use in the same or later tax year may be qualified disaster assistance property. Snaptax Any gambling or animal racing property (defined later). Snaptax Qualified revitalization building. Snaptax   This is a commercial building and its structural components that you placed in service in a renewal community before January 1, 2010. Snaptax If the building is new, the original use of the building must begin with you. Snaptax If the building is not new, you must substantially rehabilitate the building and then place it in service. Snaptax For more information, including definitions of substantially rehabilitated building and qualified revitalization expenditure, see section 1400I(b) of the Internal Revenue Code. Snaptax Gambling or animal racing property. Snaptax   Gambling or animal racing property includes the following personal and real property. Snaptax Any equipment, furniture, software, or other property used directly in connection with gambling, the racing of animals, or the on-site viewing of such racing. Snaptax Any real property determined by square footage (other than any portion that is less than 100 square feet) that is dedicated to gambling, the racing of animals, or the on-site viewing of such racing. Snaptax Certain Qualified Property Acquired After December 31, 2007 You can take a 50% special depreciation deduction allowance for certain qualified property acquired after December 31, 2007. Snaptax Your property is qualified property if it meets the following requirements. Snaptax It is one of the following types of property. Snaptax Tangible property depreciated under MACRS with a recovery period of 20 years or less. Snaptax Water utility property. Snaptax Computer software that is readily available for purchase by the general public, is subject to a nonexclusive license, and has not been substantially modified. Snaptax (The cost of some computer software is treated as part of the cost of hardware and is depreciated under MACRS. Snaptax ) Qualified leasehold improvement property (defined under Qualified leasehold improvement property later). Snaptax You must have acquired the property after December 31, 2007, with no binding written contract for the acquisition in effect before January 1, 2008. Snaptax The property must be placed in service for use in your trade or business or for the production of income before January 1, 2014 (before January 1, 2015, for certain property with a long production period and certain aircraft (defined next)). Snaptax The original use of the property must begin with you after December 31, 2007. Snaptax It is not excepted property (explained later in Excepted property). Snaptax Qualified leasehold improvement property. Snaptax    Generally, this is any improvement to an interior part of a building that is nonresidential real property, if all the following requirements are met. Snaptax The improvement is made under or according to a lease by the lessee (or any sublessee) or the lessor of that part of the building. Snaptax That part of the building is to be occupied exclusively by the lessee (or any sublessee) of that part. Snaptax The improvement is placed in service more than 3 years after the date the building was first placed in service by any person. Snaptax The improvement is section 1250 property. Snaptax See chapter 3 in Publication 544, Sales and Other Dispositions of Assets, for the definition of section 1250 property. Snaptax   However, a qualified leasehold improvement does not include any improvement for which the expenditure is attributable to any of the following. Snaptax The enlargement of the building. Snaptax Any elevator or escalator. Snaptax Any structural component benefiting a common area. Snaptax The internal structural framework of the building. Snaptax   Generally, a binding commitment to enter into a lease is treated as a lease and the parties to the commitment are treated as the lessor and lessee. Snaptax However, a lease between related persons is not treated as a lease. Snaptax Related persons. Snaptax   For this purpose, the following are related persons. Snaptax Members of an affiliated group. Snaptax An individual and a member of his or her family, including only a spouse, child, parent, brother, sister, half-brother, half-sister, ancestor, and lineal descendant. Snaptax A corporation and an individual who directly or indirectly owns 80% or more of the value of the outstanding stock of that corporation. Snaptax Two corporations that are members of the same controlled group. Snaptax A trust fiduciary and a corporation if 80% or more of the value of the outstanding stock is directly or indirectly owned by or for the trust or grantor of the trust. Snaptax The grantor and fiduciary, and the fiduciary and beneficiary, of any trust. Snaptax The fiduciaries of two different trusts, and the fiduciaries and beneficiaries of two different trusts, if the same person is the grantor of both trusts. Snaptax A tax-exempt educational or charitable organization and any person (or, if that person is an individual, a member of that person's family) who directly or indirectly controls the organization. Snaptax Two S corporations, and an S corporation and a regular corporation, if the same persons own 80% or more of the value of the outstanding stock of each corporation. Snaptax A corporation and a partnership if the same persons own both of the following. Snaptax 80% or more of the value of the outstanding stock of the corporation. Snaptax 80% or more of the capital or profits interest in the partnership. Snaptax The executor and beneficiary of any estate. Snaptax Long Production Period Property To be qualified property, long production period property must meet the following requirements. Snaptax It must meet the requirements in (2)-(5), above. Snaptax The property has a recovery period of at least 10 years or is transportation property. Snaptax Transportation property is tangible personal property used in the trade or business of transporting persons or property. Snaptax The property is subject to section 263A of the Internal Revenue Code. Snaptax The property has an estimated production period exceeding 1 year and an estimated production cost exceeding $1,000,000. Snaptax Noncommercial Aircraft To be qualified property, noncommercial aircraft must meet the following requirements. Snaptax It must meet the requirements in (2)-(5), above. Snaptax The aircraft must not be tangible personal property used in the trade or business of transporting persons or property (except for agricultural or firefighting purposes). Snaptax The aircraft must be purchased (as discussed under Property Acquired by Purchase in chapter 2 ) by a purchaser who at the time of the contract for purchase, makes a nonrefundable deposit of the lesser of 10% of the cost or $100,000. Snaptax The aircraft must have an estimated production period exceeding four months and a cost exceeding $200,000. Snaptax Special Rules Sale-leaseback. Snaptax   If you sold qualified property you placed in service after December 31, 2007, and leased it back within 3 months after you originally placed in service, the property is treated as originally placed in service no earlier than the date it is used by you under the leaseback. Snaptax   The property will not qualify for the special depreciation allowance if the lessee or a related person to the lessee or lessor had a written binding contract in effect for the acquisition of the property before January 1, 2008. Snaptax Syndicated leasing transactions. Snaptax   If qualified property is originally placed in service by a lessor after December 31, 2007, the property is sold within 3 months of the date it was placed in service, and the user of the property does not change, then the property is treated as originally placed in service by the taxpayer no earlier than the date of the last sale. Snaptax   Multiple units of property subject to the same lease will be treated as originally placed in service no earlier than the date of the last sale if the property is sold within 3 months after the final unit is placed in service and the period between the time the first and last units are placed in service does not exceed 12 months. Snaptax Excepted Property Qualified property does not include any of the following. Snaptax Property placed in service and disposed of in the same tax year. Snaptax Property converted from business use to personal use in the same tax year acquired. Snaptax Property converted from personal use to business use in the same or later tax year may be qualified property. Snaptax Property required to be depreciated under the Alternative Depreciation System (ADS). Snaptax This includes listed property used 50% or less in a qualified business use. Snaptax For other property required to be depreciated using ADS, see Required use of ADS under Which Depreciation System (GDS or ADS) Applies , in chapter 4 . Snaptax Qualified restaurant property (as defined in section 168(e)(7) of the Internal Revenue Code). Snaptax Qualified retail improvement property (as defined in section 168(e)(8) of the Internal Revenue Code). Snaptax Property for which you elected not to claim any special depreciation allowance (discussed later). Snaptax Property for which you elected to accelerate certain credits in lieu of the special depreciation allowance (discussed next). Snaptax Election to Accelerate Certain Credits in Lieu of the Special Depreciation Allowance An election made by a corporation to claim pre-2006 unused minimum tax credits in lieu of claiming the special depreciation allowance for either its first tax year ending after March 31, 2008, its first tax year ending after December 31, 2008, or its first tax year ending after December 31, 2010, continues to apply to round 2 extension property (as defined in section 168(k)(4)(I)(iv)), unless the corporation made an election not to apply the section 168(k)(4) election to round 2 extension property for its first tax year ending after December 31, 2010. Snaptax For 2013, round 2 extension property generally is long production period and noncommercial aircraft if acquired after March 31, 2008, and placed in service after December 31, 2012, but before January 1, 2014. Snaptax An election made by a corporation to claim pre-2006 unused minimum tax credits in lieu of claiming the special depreciation allowance for either its first tax year ending after March 31, 2008, its first tax year ending after December 31, 2008, or its first tax year ending after December 31, 2010, continues to apply to round 3 extension property (as defined in section 168(k)(4)(J)(iv)), unless the corporation makes an election not to apply the section 168(k)(4) election to round 3 extension property. Snaptax If a corporation did not make a section 168(k)(4) election for either its first tax year ending after March 31, 2008, its first tax year ending after December 31, 2008, or its first tax year ending after December 31, 2010, the corporation may elect for its first tax year ending after December 31, 2012, to claim pre-2006 unused minimum tax credits in lieu of claiming the special depreciation allowance for only round 3 extension property. Snaptax If you make an election to accelerate these credits in lieu of claiming the special depreciation allowance for eligible property, you must not take the 50% special depreciation allowance for the property and must depreciate the basis in the property under MACRS using the straight line method. Snaptax See Which Depreciation Method Applies in chapter 4 . Snaptax Once made, the election cannot be revoked without IRS consent. Snaptax Additional guidance. Snaptax   For additional guidance on the election to accelerate the research or minimum tax credit in lieu of claiming the special depreciation allowance, see Rev. Snaptax Proc. Snaptax 2008-65 on page 1082 of Internal Revenue Bulletin 2008-44, available at www. Snaptax irs. Snaptax gov/pub/irs-irbs/irb08-44. Snaptax pdf, Rev. Snaptax Proc. Snaptax 2009-16 on page 449 of Internal Revenue Bulletin 2009-06, available at www. Snaptax irs. Snaptax gov/pub/irs-irbs/irb09-06. Snaptax pdf, and Rev. Snaptax Proc. Snaptax 2009-33 on page 150 of Internal Revenue Bulletin 2009-29, available at www. Snaptax irs. Snaptax gov/pub/irs-irbs/irb09-29. Snaptax pdf. Snaptax Also, see Form 3800, General Business Credit; Form 8827, Credit for Prior Year Minimum Tax — Corporations; and related instructions. Snaptax   Additional guidance regarding the election to accelerate the minimum tax credit in lieu of claiming the special depreciation allowance for round 2 extension property and round 3 extension property may also be available in later Internal Revenue Bulletins available at www. Snaptax irs. Snaptax gov/irb. Snaptax How Much Can You Deduct? Figure the special depreciation allowance by multiplying the depreciable basis of qualified reuse and recycling property, qualified cellulosic biofuel plant property, qualified disaster assistance property, and certain qualified property acquired after December 31, 2007, by 50%. Snaptax For qualified property other than listed property, enter the special allowance on line 14 in Part II of Form 4562. Snaptax For qualified property that is listed property, enter the special allowance on line 25 in Part V of Form 4562. Snaptax If you place qualified property in service in a short tax year, you can take the full amount of a special depreciation allowance. Snaptax Depreciable basis. Snaptax   This is the property's cost or other basis multiplied by the percentage of business/investment use, reduced by the total amount of any credits and deductions allocable to the property. Snaptax   The following are examples of some credits and deductions that reduce depreciable basis. Snaptax Any section 179 deduction. Snaptax Any deduction for removal of barriers to the disabled and the elderly. Snaptax Any disabled access credit, enhanced oil recovery credit, and credit for employer-provided childcare facilities and services. Snaptax Basis adjustment to investment credit property under section 50(c) of the Internal Revenue Code. Snaptax   For additional credits and deductions that affect basis, see section 1016 of the Internal Revenue Code. Snaptax   For information about how to determine the cost or other basis of property, see What Is the Basis of Your Depreciable Property in chapter 1 . Snaptax For a discussion of business/investment use, see Partial business or investment use under Property Used in Your Business or Income-Producing Activity in chapter 1 . Snaptax Depreciating the remaining cost. Snaptax   After you figure your special depreciation allowance for your qualified property, you can use the remaining cost to figure your regular MACRS depreciation deduction (discussed in chapter 4 . Snaptax Therefore, you must reduce the depreciable basis of the property by the special depreciation allowance before figuring your regular MACRS depreciation deduction. Snaptax Example. Snaptax On November 1, 2013, Tom Brown bought and placed in service in his business qualified property that cost $450,000. Snaptax He did not elect to claim a section 179 deduction. Snaptax He deducts 50% of the cost ($225,000) as a special depreciation allowance for 2013. Snaptax He uses the remaining $225,000 of cost to figure his regular MACRS depreciation deduction for 2013 and later years. Snaptax Like-kind exchanges and involuntary conversions. Snaptax   If you acquire qualified property in a like-kind exchange or involuntary conversion, the carryover basis of the acquired property is eligible for a special depreciation allowance. Snaptax After you figure your special allowance, you can use the remaining carryover basis to figure your regular MACRS depreciation deduction. Snaptax In the year you claim the allowance (the year you place in service the property received in the exchange or dispose of involuntarily converted property), you must reduce the carryover basis of the property by the allowance before figuring your regular MACRS depreciation deduction. Snaptax See Figuring the Deduction for Property Acquired in a Nontaxable Exchange , in chapter 4 under How Is the Depreciation Deduction Figured . Snaptax The excess basis (the part of the acquired property's basis that exceeds its carryover basis) is also eligible for a special depreciation allowance. Snaptax How Can You Elect Not To Claim an Allowance? You can elect, for any class of property, not to deduct any special allowances for all property in such class placed in service during the tax year. Snaptax To make an election, attach a statement to your return indicating what election you are making and the class of property for which you are making the election. Snaptax When to make election. Snaptax   Generally, you must make the election on a timely filed tax return (including extensions) for the year in which you place the property in service. Snaptax   However, if you timely filed your return for the year without making the election, you can still make the election by filing an amended return within 6 months of the due date of the original return (not including extensions). Snaptax Attach the election statement to the amended return. Snaptax On the amended return, write “Filed pursuant to section 301. Snaptax 9100-2. Snaptax ” Revoking an election. Snaptax   Once you elect not to deduct a special depreciation allowance for a class of property, you cannot revoke the election without IRS consent. Snaptax A request to revoke the election is a request for a letter ruling. Snaptax If you elect not to have any special allowance apply, the property may be subject to an alternative minimum tax adjustment for depreciation. Snaptax When Must You Recapture an Allowance? When you dispose of property for which you claimed a special depreciation allowance, any gain on the disposition is generally recaptured (included in income) as ordinary income up to the amount of the special depreciation allowance previously allowed or allowable. Snaptax See When Do You Recapture MACRS Depreciation in chapter 4 or more information. Snaptax Recapture of allowance deducted for qualified GO Zone property. Snaptax   If, in any year after the year you claim the special depreciation allowance for qualified GO Zone property (including specified GO Zone extension property), the property ceases to be used in the GO Zone, you may have to recapture as ordinary income the excess benefit you received from claiming the special depreciation allowance. Snaptax For additional guidance, see Notice 2008-25 on page 484 of Internal Revenue Bulletin 2008-9. Snaptax Qualified cellulosic biomass ethanol plant property and qualified cellulosic biofuel plant property. Snaptax   If, in any year after the year you claim the special depreciation allowance for any qualified cellulosic biomass ethanol plant property or qualified biofuel plant property, the property ceases to be qualified cellulosic biomass ethanol plant property or qualified biofuel plant property, you may have to recapture as ordinary income the excess benefit you received from claiming the special depreciation allowance. Snaptax Recapture of allowance for qualified Recovery Assistance property. Snaptax   If, in any year after the year you claim the special depreciation allowance for qualified Recovery Assistance property, the property ceases to be used in the Kansas disaster area, you may have to recapture as ordinary income the excess benefit you received from claiming the special depreciation allowance. Snaptax For additional guidance, see Notice 2008-67 on page 307 of Internal Revenue Bulletin 2008-32. Snaptax Recapture of allowance for qualified disaster assistance property. Snaptax   If, in any year after the year you claim the special depreciation allowance for qualified disaster assistance property, the property ceases to be used in the applicable disaster area, you may have to recapture as ordinary income the excess benefit you received from claiming the special depreciation allowance. Snaptax   For additional guidance, see Notice 2008-67 on page 307 of Internal Revenue Bulletin 2008-32. Snaptax Prev  Up  Next   Home   More Online Publications