Extended rules pertaining to Sec. 179

[Jack from Ohio]

Can anyone point me to documentation that the extended 179 rules include the ability for us to use 179 election on Form 1040X for 2014?  This was in place for 2011, 2012 & 2013.  I can find that the total amount allowed was put back at $500,000.

 

This is an important fact for possible audit of clients for their 2014 tax returns.

[mcb39]

IRC 179(b ) and (f)  The ceiling for IRC 179 deductions is $25,000 in 2014 and the investment limit is $200,000

 

Elections for 2014 cannot be made on an amended return unless the amended return is filed by the original due date for the tax return.  For tax years beginning in 2003 through 2013, the election could be made on an amended return anytime during the time prescribed for filing the amended return.

 

This is taken from my National Income Tax Workbook 2014 offered by Tax Insight LLC; the classes that I attended in November.

[Jack from Ohio]

IRC 179( b ) and (f)  The ceiling for IRC 179 deductions is $25,000 in 2014 and the investment limit is $200,000

 

Elections for 2014 cannot be made on an amended return unless the amended return is filed by the original due date for the tax return.  For tax years beginning in 2003 through 2013, the election could be made on an amended return anytime during the time prescribed for filing the amended return.

 

This is taken from my National Income Tax Workbook 2014 offered by Tax Insight LLC; the classes that I attended in November.

But was this changed by the extender law that was passed?  That is the question at hand.  The 179 deduction was raised to $500,000.

[kcjenkins]

Best I can do is a link to the actual text of the bill.   Does not seem to be clear on your point, Jack.

 

https://www.congress.gov/113/bills/s1859/BILLS-113s1859pcs.pdf

[Gail in Virginia]

Very good question.  If someone has an answer, I hope they will post it.

[mcb39]

Page 1-12 The Tax Book:  Tax Extenders Late-Breaking News  "The new law also extends the provision that allows a taxpayer to revoke the Section 179 expense deduction for the 2014 tax year"  Hope this is what you are looking for.  You are correct about the $500,000 limitation for the 2014 tax year, with the $25,000 limitations to apply after December 31,2014.

[kcjenkins]

I think what Jack is looking for is a cite that backs that up, Marilyn.  I've seen that stated, but have not been able to find anything official that actually says that.  

[jklcpa]

In HR 5771, sec 127(c ) it states -    

 

"(c ) ELECTION

.—Section 179(c )(2) is amended by striking ‘‘2014’’ and inserting ‘‘2015’’

 

Link to bill:  https://www.congress.gov/113/bills/hr5771/BILLS-113hr5771pcs.pdf

 

Sec 179(c )(2) before the extenders read as follows, and I added strikethrough for the change:

(2) Election irrevocable

Any election made under this section, and any specification contained in any such election, may not be revoked except with the consent of the Secretary. Any such election or specification with respect to any taxable year beginning after 2002 and before 2014 2015 may be revoked by the taxpayer with respect to any property, and such revocation, once made, shall be irrevocable.

[kcjenkins]

Thanks, Judy.  I'd actually linked to that, but somehow overlooked it when scanning it.  Must have misspelled 'election' when I used Find.  

[Jack from Ohio]

 

In HR 5771, sec 127(c ) it states -    

 

"(c ) ELECTION

.—Section 179(c )(2) is amended by striking ‘‘2014’’ and inserting ‘‘2015’’

 

Link to bill:  https://www.congress.gov/113/bills/hr5771/BILLS-113hr5771pcs.pdf

 

Sec 179(c )(2) before the extenders read as follows, and I added strikethrough for the change:

(2) Election irrevocable

Any election made under this section, and any specification contained in any such election, may not be revoked except with the consent of the Secretary. Any such election or specification with respect to any taxable year beginning after 2002 and before 2014 2015 may be revoked by the taxpayer with respect to any property, and such revocation, once made, shall be irrevocable.

 

Looks like the answer is YES.  That is the information I was looking for.  This is an important tool for us, if a client gets audited.

[jklcpa]

KC, for some reason I couldn't find it easily when I did a search either. I saw in the contents section of the bill that it was in sec 127 and just started reading from there.