IntroductionThis publication explains how you can recover the cost of businessor income-producing property through depreciation. Its step-by-stepapproach will show you how to figure your depreciation deduction andfill out the required tax form. There are examples throughout thepublication to help you understand the tax law. This publication is for those who want information on depreciatingproperty placed in service after 1986. If you want information aboutdepreciating property placed in service before 1987, see Publication 534, Depreciating Property Placed in Service Before 1987. What this publication contains.This publication contains six chapters and two appendices.Chapter 1 defines depreciation in general terms and describes typesof property. It states what property can and cannot be depreciated,when depreciation begins and ends, and shows you how to claimdepreciation on Form 4562.Chapter 2 estrategia di pai gowdefines the section 179 deduction. It discusses whatproperty costs can and cannot be deducted. It also explains when andhow to claim the deduction, and how to figure the deduction. Itconcludes with a discussion on when to recapture the deduction.Chapter 3 defines the Modified Accelerated Cost Recovery System(MACRS). It provides an introduction and explanation of the entiresystem. It has a MACRS worksheet to help you figure your deduction.Chapter 4 defines listed property. It explains the rules for listedproperty and the special limits on the amount of depreciation andsection 179 deduction that you can claim for passenger automobiles. Ithas a worksheet to help you figure the maximum depreciation deductionfor passenger automobiles.Chapter 5 is a comprehensive example showing how to figure both thesection 179 and depreciation deductions. It includes a filled-in Form4562 and a filled-in depreciation worksheet.Chapter 6 tells you how to get information, free publications, andforms from the IRS. Appendix A contains the Linz hotelsMACRS Percentage Tables. Appendix B contains The Table of Class Lives and RecoveryPeriods. Definitions.Many of the terms used in this publication are defined in theGlossary near the end of this publication. Additional information.For more detailed information on depreciating a car, residentialrental property, and office space in your home, see the following. Envelope: We welcome your suggestions for future editions of thispublication. Please send your ideas to:
Internal Revenue Service
Technical Publications Branch (OP:FS:FP:P:3)
1111 Constitution Avenue, N.W.
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