This article explains that bonus depreciation rules have been changed over several years. In 2016 and 2017, under the IRS Revenue Proclamation (Rev. Proc.) 2019-33, Section 5.02 Section – Deemed Election states: “a taxpayer that timely filed its federal tax return for the 2016 taxable year or the 2017 taxable year also will be treated as making the §168(k)(7) election for a class of property that is qualified property acquired after September 27, 2017 by the taxpayer and placed in service by the taxpayer during its 2016 taxable year.” For 2018, 2019, or 2020, “there was no deemed election out of bonus depreciation for these years. If the taxpayer failed to take bonus depreciation and qualified, then they are using an impermissible method.” In 2021, “As final regulations specify, the election out has to be made on your original return. If you missed bonus depreciation and discovered it in a later year, you can amend it if you catch it in 2022. If you catch it in 2023 or later, file 3115 under Rev. Proc. 2015-13.” To gain further knowledge on these updates on bonus depreciation in cost segregation, click the link!
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