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Department of the Treasury
Internal Revenue Service
2022

Instructions for Form 4562

Depreciation and Amortization (Including Information on Listed Property)

Section references are to the Internal Revenue • Claim your deduction for depreciation Definitions
Code unless otherwise noted. and amortization,
• Make the election under section 179 Depreciation
Future Developments to expense certain property, and Depreciation is the annual deduction
For the latest information about • Provide information on the business/ that allows you to recover the cost or
developments related to Form 4562 and investment use of automobiles and other basis of your business or
its instructions, such as legislation other listed property. investment property over a certain
enacted after this form and instructions number of years. Depreciation starts
were published, go to IRS.gov/ Who Must File when you first use the property in your
Form4562. Except as otherwise noted, complete business or for the production of
and file Form 4562 if you are claiming income. It ends when you either take the
What's New any of the following. property out of service, deduct all your
Section 179 deduction dollar limits. • Depreciation for property placed in depreciable cost or basis, or no longer
For tax years beginning in 2022, the service during the 2022 tax year. use the property in your business or for
maximum section 179 expense • A section 179 expense deduction the production of income.
deduction is $1,080,000. This limit is (which may include a carryover from a
reduced by the amount by which the previous year). Generally, you can depreciate:
cost of section 179 property placed in • Depreciation on any vehicle or other • Tangible property such as buildings,
service during the tax year exceeds listed property (regardless of when it machinery, vehicles, furniture, and
$2,700,000. Also, the maximum section was placed in service). equipment; and
179 expense deduction for sport utility • A deduction for any vehicle reported • Intangible property such as patents,
vehicles (SUVs) placed in service in tax on a form other than Schedule C (Form copyrights, and computer software.
years beginning in 2022 is $27,000. 1040), Profit or Loss From Business. Exception. You cannot depreciate
• Any depreciation on a corporate land.
Phase down of the special deprecia- income tax return (other than Form
tion allowance for certain property. 1120-S). Accelerated Cost Recovery
Certain qualified property (other than • Amortization of costs that begins System
property with a long production period during the 2022 tax year. The Accelerated Cost Recovery System
and certain aircraft) placed in service (ACRS) applies to property first used
after December 31, 2022, and before If you are an employee deducting
January 1, 2024, is limited to a special job-related vehicle expenses using before 1987. It is the name given for the
allowance of 80% of the depreciable either the standard mileage rate or tax rules that allow a taxpayer to recover
basis of the property. For certain plants actual expenses, use Form 2106, through depreciation deductions the
bearing fruits and nuts planted and Employee Business Expenses, for this cost of property used in a trade or
grafted after December 31, 2022, and purpose. business or to produce income. These
rules are mandatory and generally apply
before January 1, 2024, the special File a separate Form 4562 for each to tangible property placed in service
depreciation allowance is also limited to business or activity on your return for after 1980 and before 1987. If you
80% of the adjusted basis of the which Form 4562 is required. If you placed property in service during this
specified plants. See Certain qualified need more space, attach additional period, you must continue to figure your
property acquired after September 27, sheets. However, complete only one depreciation under ACRS.
2017 and Certain plants bearing fruits Part I in its entirety when computing
and nuts, later. your section 179 expense deduction. ACRS consists of accelerated
Amortization of research and experi- See the instructions for line 12, later. depreciation methods and an alternate
mental expenditures. Specified ACRS method that could have been
research and experimental costs paid or Additional Information elected. The alternate ACRS method
incurred in tax years beginning in 2022 For more information about depreciation used a recovery percentage based on a
must be capitalized and amortized and amortization (including information modified straight line method. See the
ratably over a 5-year period (15-year on listed property), see the following. instructions for line 16 for more
period for any expenditures related to • Pub. 463, Travel, Gift, and Car information. For a complete discussion
foreign research). See Research and Expenses. of ACRS, see Pub. 534.
experimental expenditures (section • Pub. 534, Depreciating Property Modified Accelerated Cost
174), later. Placed in Service Before 1987.
Recovery System
• Pub. 535, Business Expenses.
General Instructions • Pub. 551, Basis of Assets. The Modified Accelerated Cost
• Pub. 946, How To Depreciate Recovery System (MACRS) is the
Property. current method of accelerated asset
Purpose of Form depreciation required by the tax code.
Use Form 4562 to: Under MACRS, all assets are divided

Jan 5, 2023 Cat. No. 12907Y

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into classes which dictate the number of property used under a lease with a term communication, and video recording
years over which an asset's cost will be of less than 6 months). equipment).
recovered. Each MACRS class has a
predetermined schedule which See the instructions for Part I and Exceptions. Listed property does not
determines the percentage of the Pub. 946. include:
1. Photographic, phonographic,
asset's costs which is depreciated each Special rules for qualified section communication, or video equipment
year. For more information, see Part III. 179 real property. You can elect to used exclusively in a taxpayer's trade or
MACRS Depreciation, later. For a treat certain qualified real property business or at the taxpayer's regular
complete discussion of MACRS, see placed in service during the tax year as business establishment;
chapter 4 of Pub. 946. section 179 property. See Election for
Section 179 Property certain qualified section 179 real 2. Any computer or peripheral
property under Part I, later, for equipment used exclusively at a regular
Section 179 property is property that information on how to make this business establishment and owned or
you acquire by purchase for use in the election. If the election is made, the term leased by the person operating the
active conduct of your trade or "section 179 property" will include any establishment;
business, and is one of the following. qualified real property which is: 3. An ambulance, hearse, or vehicle
• Qualified section 179 real property. Qualified improvement property as used for transporting persons or
For more information, see Special rules •
described in section 168(e)(6), and property for compensation or hire; or
later. •
for qualified section 179 real property, Any of the following improvements to 4. Any truck or van placed in service
nonresidential real property placed in after July 6, 2003, that is a qualified
• Tangible personal property, including service after the date the nonresidential nonpersonal use vehicle.
cellular telephones, similar real property was first placed in service.
telecommunications equipment, and air For purposes of the exceptions
conditioning or heating units (for 1. Roofs.
above, a portion of the taxpayer's home
example, portable air conditioners or 2. Heating, ventilation, and is treated as a regular business
heaters). Also, tangible personal air-conditioning property. establishment only if that portion meets
property may include certain property 3. Fire protection and alarm the requirements for deducting
used mainly to furnish lodging or in systems. expenses attributable to the business
connection with the furnishing of lodging use of a home. However, for any
(except as provided in section 50(b)(2)). 4. Security systems.
property listed in (1) above, the regular
• Other tangible property (except This property is considered "qualified business establishment of an employee
buildings and their structural section 179 real property." is his or her employer's regular business
components) used as: A deduction attributable to qualified establishment.
1. An integral part of manufacturing, section 179 real property which is
production, or extraction, or of disallowed under the trade or business Commuting
furnishing transportation, income limitation (see Business Income Generally, commuting is defined as
communications, electricity, gas, water, Limit in chapter 2 of Pub. 946) for 2022 travel between your home and a work
or sewage disposal services; can be carried over to 2023. Thus, the location. However, travel that meets any
2. A research facility used in amount of any 2022 disallowed section of the following conditions is not
connection with any of the activities in 179 expense deduction attributable to commuting.
(1) above; or qualified section 179 real property will • You have at least one regular work
be reported on line 13 of Form 4562. location away from your home and the
3. A facility used in connection with travel is to a temporary work location in
any of the activities in (1) above for the Amortization the same trade or business, regardless
bulk storage of fungible commodities. Amortization is similar to the straight line of the distance. Generally, a temporary
• Single purpose agricultural (livestock) method of depreciation in that an annual work location is one where your
or horticultural structures. deduction is allowed to recover certain employment is expected to last 1 year
• Storage facilities (except buildings costs over a fixed time period. You can or less. See Pub. 463 for details.
and their structural components) used in amortize such items as the costs of • The travel is to a temporary work
connection with distributing petroleum starting a business, goodwill, and location outside the metropolitan area
or any primary product of petroleum. certain other intangibles. See the where you live and normally work.
• Off-the-shelf computer software. instructions for Part VI. • Your home is your principal place of
Section 179 property does not Listed Property business for purposes of deducting
expenses for business use of your
include the following. Listed property generally includes the home and the travel is to another work
• Property held for investment (section following. location in the same trade or business,
212 property). • Passenger automobiles weighing regardless of whether that location is
• Property used mainly outside the 6,000 pounds or less. See Limits for regular or temporary and regardless of
United States (except for property passenger automobiles, later. distance.
described in section 168(g)(4)). • Any other property used for
• Property used by a tax-exempt transportation if the nature of the
Alternative Minimum Tax
organization (other than a section 521 property lends itself to personal use,
farmers' cooperative) unless the such as motorcycles, pickup trucks, (AMT)
property is used mainly in a taxable SUVs, etc. Depreciation may be an adjustment for
unrelated trade or business. • Any property used for entertainment the AMT. However, no adjustment
• Property used by a governmental unit or recreational purposes (such as applies in several instances. See Form
or foreign person or entity (except for photographic, phonographic, 6251, Alternative Minimum

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Tax—Individuals; Schedule I (Form          amended return must specify the item of    of the increased section 179 expense 
1041), Alternative Minimum                 section 179 property to which the          deduction must be reported as “other 
Tax—Estates and Trusts; and the            election applies and the part of the cost  income” on your return. Similar rules 
related instructions.                      of each such item to be taken into         apply if qualified Liberty Zone property 
                                           account. The amended return must also      ceases to be used in the Liberty Zone, if 
Recordkeeping                              include any resulting adjustments to       qualified section 179 GO Zone property 
Except for Part V (relating to listed      taxable income.                            ceases to be used in the GO Zone, if 
                                                                                      qualified section 179 Recovery 
property), the IRS does not require you    Election for certain qualified             Assistance property ceases to be used 
to submit detailed information with your   section 179 real property.  You can        in the Recovery Assistance area, if 
return on the depreciation of assets       elect to expense certain qualified real    qualified empowerment zone property 
placed in service in previous tax years.   property that you first placed in service  ceases to be used in an empowerment 
However, the information needed to         as section 179 property for tax years      zone by an enterprise zone business, or 
compute your depreciation deduction        beginning in 2022. For more                if qualified renewal property ceases to 
(basis, method, etc.) must be part of      information, see Election above.           be used in a renewal community by a 
your permanent records.
                                           Revocation. The election (or any           renewal community business in any 
      You may use the Depreciation         specification made in the election) can    year after you claim the increased 
TIP   Worksheet, later, to assist you      be revoked without obtaining IRS           section 179 expense deduction.
      in maintaining depreciation          approval by filing an amended return. 
records. However, the worksheet is         The amended return must be filed within    Line 2
designed only for federal income tax       the time prescribed by law for the         Enter the total cost of all section 179 
purposes. You may need to keep             applicable tax year. The amended           property you placed in service during 
additional records for accounting and      return must include any resulting          the tax year (including the total cost of 
state income tax purposes.                 adjustments to taxable income or to the    qualified real property that you elect to 
                                           tax liability (for example, allowable      treat as section 179 property). Also, 
                                           depreciation in that tax year for the item include the cost of the following.
Specific Instructions                      of section 179 property to which the       • Any listed property from Part V.
                                           revocation pertains). For more             • Any property placed in service by 
Part I. Election To Expense                information and examples, see              your spouse, even if you are filing a 
Certain Property Under                     Regulations sections 1.179-5(c)(3) and     separate return. This includes qualified 
                                           (c)(4). Once made, the revocation is       section 179 real property that your 
Section 179                                                                           spouse made the election to treat as 
                                           irrevocable.
                                                                                      section 179 property for 2022.
                                                   If you elect to expense section 
Note. An estate or trust cannot make       !       179 property, you must reduce      Line 3
this election.                             CAUTION the amount on which you figure     The amount of section 179 property for 
  You can elect to expense part or all     your depreciation or amortization          which you can make the election is 
of the cost of section 179 property        deduction (including any special           limited to the maximum dollar amount 
(defined earlier) that you placed in       depreciation allowance) by the section     on line 1. This amount is reduced if the 
service during the tax year and used       179 expense deduction.                     cost of all section 179 property placed in 
predominantly (more than 50%) in your                                                 service in 2022 is more than 
trade or business.                         Line 1                                     $2,700,000.
                                           Generally, the maximum section 179           For a partnership, these limitations 
  However, for taxpayers other than a      expense deduction is $1,080,000 for        apply to the partnership and each 
corporation, this election does not apply  section 179 property (including qualified  partner. For an S corporation, these 
to any section 179 property you            section 179 real property) placed in       limitations apply to the S corporation 
purchased and leased to others unless:     service during the tax year beginning in   and each shareholder. For a controlled 
• You manufactured or produced the         2022.                                      group, all component members are 
property; or
                                                                                      treated as one taxpayer.
• The term of the lease is less than               You can use Worksheet 1 to 
50% of the property's class life and, for  TIP     assist you in determining the      Line 5
the first 12 months after the property is          amount to enter on line 1.         If line 5 is zero, you cannot elect to 
transferred to the lessee, the deductions 
                                                                                      expense any section 179 property. In 
related to the property allowed to you as  Recapture rule.  If the section 179        this case, skip lines 6 through 11, enter 
trade or business expenses (except         property is not used predominantly         zero on line 12, and enter the carryover 
rents and reimbursed amounts) are          (more than 50%) in your trade or           of any disallowed deduction from 2019 
more than 15% of the rental income         business at any time before the end of     (which does not include amounts 
from the property.                         the property's recovery period, the        attributable to qualified section 179 real 
Election. You must make the election       benefit of the section 179 expense         property) on line 13.
on Form 4562 filed with either:            deduction must be reported as “other 
• The original return you file for the tax income” on your return.                      See Special rules for qualified 
year the property was placed in service    If any qualified section 179 disaster      section 179 real property, earlier.
(whether or not you file your return on    assistance property ceases to be used        If you are married filing separately, 
time), or                                  in the applicable federally declared       you and your spouse must allocate the 
• An amended return filed within the       disaster area in any year after you claim  dollar limitation for the tax year. To do 
time prescribed by law for the applicable  the increased section 179 expense          so, multiply the total limitation that you 
tax year. The election made on an          deduction for that property, the benefit   would otherwise enter on line 5 by 50% 

Instructions for Form 4562 (2022)                           -3-

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Worksheet 1. Worksheet for Lines 1, 2, and deduction. Also, include all wages,
3 Keep for Your Records salaries, tips, and other compensation
you earned as an employee (from Form
Maximum section 179 limitation calculation. 1040, line 1). Do not reduce this amount
by unreimbursed employee business
1.* Enter total cost of section 179 property (including qualified section 179 real expenses. If you are married filing a joint
property) placed in service during the tax year beginning in 2022 . . . . . . . . .
return, combine the total taxable
2. The maximum section 179 deduction limitation for 2022 . . . . . . . . . . . . . . . $1,080,000 incomes for you and your spouse.
3. Enter the smaller of line 1 or line 2 here . . . . . . . . . . . . . . . . . . . . . . . . . . . Partnerships. Enter the smaller of
4. Enter the amount from line 3 here and on Form 4562, line 1 . . . . . . . . . . . . . line 5 or the partnership's total items of
income and expense, described in
Maximum threshold cost of section 179 property before reduction in limitation calculation. section 702(a), from any trade or
5. Enter the amount from line 1 here and on Form 4562, line 2 . . . . . . . . . . . . . business the partnership actively
conducted (other than credits,
6. Base maximum threshold cost of section 179 property before reduction in $2,700,000 tax-exempt income, the section 179
limitation for 2022. Enter this amount on Form 4562, line 3 . . . . . . . . . . . . . . expense deduction, and guaranteed
Maximum elected cost for Form 4562, lines 6 and 7, column (c). payments under section 707(c)).
7. Enter the smaller of line 1 or line 4. The total amount you enter on Form S corporations. Enter the smaller of
4562, lines 6 and 7, column (c), cannot exceed this amount . . . . . . . . . line 5 or the corporation's total items of
* For line 1 of this worksheet, include the total amount of eligible section 179 property (including qualified section income and expense described in
179 real property), not just the amount for which you are making the election. See the instructions for line 2. section 1366(a) from any trade or
business the corporation actively
conducted (other than credits,
tax-exempt income, the section 179
(0.50), unless you both elect a different Line 7 expense deduction, and the deduction
allocation. If you both elect a different Enter the amount that you elected to for compensation paid to the
allocation, multiply the total limitation by expense for listed property (defined corporation's shareholder-employees).
the percentage elected. The sum of the earlier) on line 29 here. For more
percentages you and your spouse elect information, see Part V—Listed Corporations other than S corpora-
must equal 100%. Property, later. tions. Enter the smaller of line 5 or the
corporation's taxable income before the
Do not enter on line 5 more than your Line 10 section 179 expense deduction, net
share of the total dollar limitation. operating loss deduction, and special
The carryover of disallowed deduction
Line 6 from 2021 is the amount of section 179 deductions (excluding items not derived
Do not include any listed property on property, if any, you elected to expense from a trade or business actively
line 6. Enter the elected section 179 in previous years that was not allowed conducted by the corporation).
cost of listed property in column (i) of as a deduction because of the business Line 12
line 26. income limitation. If you filed Form 4562
for 2021, enter the amount from line 13 The limitations on lines 5 and 11 apply
Column (a)—Description of proper- of your 2021 Form 4562. to the taxpayer, and not to each
ty. Enter a brief description of the separate business or activity. Therefore,
property you elect to expense (for Line 11 if you have more than one business or
example, truck, office furniture, qualified The total cost you can deduct is limited activity, you may allocate your allowable
improvement property, roof, etc.). to your taxable income from the active section 179 expense deduction among
Column (b)—Cost (business use on- conduct of a trade or business during them.
ly). Enter the cost of the property. If you the year. You are considered to actively
acquired the property through a conduct a trade or business only if you To do so, enter “Summary” at the top
trade-in, do not include any carryover meaningfully participate in its of Part I of the separate Form 4562 you
basis of the property traded in. Include management or operations. A mere are completing for the total amounts
only the excess of the cost of the passive investor is not considered to from all businesses or activities. Do not
property over the value of the property actively conduct a trade or business. complete the rest of that form. On
line 12 of the Form 4562 you prepare for
traded in. each separate business or activity, enter
Note. If you have to apply another
Column (c)—Elected cost. Enter the Code section that has a limitation based the amount allocated to the business or
amount you elect to expense. You can on taxable income, see Pub. 946 for activity from the “Summary.” No other
depreciate the amount you do not rules on how to apply the business entry is required in Part I of the separate
expense. See the line 19 and line 20 income limitation for the section 179 Form 4562 prepared for each business
instructions. expense deduction. or activity.

To report your share of a section 179 Individuals. Enter the smaller of line 5 Part II. Special
expense deduction from a partnership or the total taxable income from any
or an S corporation, enter “from trade or business you actively Depreciation Allowance
Schedule K-1 (Form 1065)” or “from conducted, computed without regard to and Other Depreciation
Schedule K-1 (Form 1120-S)” across any section 179 expense deduction, the
columns (a) and (b). deduction for one-half of Line 14
self-employment taxes under section For qualified property (defined below)
164(f), or any net operating loss placed in service during the tax year,

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you may be able to take an additional real estate), along with any depreciation allowance in the
special depreciation allowance. The appurtenance, that is used exclusively subsequent tax year in which it is placed
special depreciation allowance applies to collect, distribute, or recycle qualified in service.
only for the first year the property is reuse and recyclable materials. This To make the election, attach a
placed in service. The allowance is an includes software necessary to operate statement to your timely filed return
additional deduction you can take after such equipment. See section 168(m)(3) (including extensions) indicating you are
any section 179 expense deduction and for more information. electing to apply section 168(k)(5) and
before you figure regular depreciation Qualified reuse and recycling identifying the specified plant(s) for
under MACRS. property must also meet all of the which you are making the election.
Qualified property. You can take the following tests. Once made, the election cannot be
special depreciation allowance for • The property must be depreciated revoked without IRS consent.
certain qualified property acquired after under MACRS.
September 27, 2017, qualified reuse • The property must have a useful life Exceptions. Qualified property does
and recycling property, and certain of at least 5 years. not include:
plants bearing fruits and nuts. • You must have acquired the property • Listed property used 50% or less in a
by purchase after August 31, 2008. If a qualified business use (as defined in the
Certain qualified property binding contract to acquire the property instructions for lines 26 and 27);
acquired after September 27, 2017. existed before September 1, 2008, the • Any property required to be
Certain qualified property (defined property does not qualify. depreciated under the Alternative
below) acquired after September 27, • The property must be placed in Depreciation System (ADS) (that is, not
2017, and placed in service before service after August 31, 2008. property for which you elected to use
January 1, 2023 (or before January 1, • The original use of the property must ADS);
2024, for certain property with a long begin with you after August 31, 2008. • Property placed in service and
production period and for certain • For self-constructed property, special disposed of in the same tax year;
aircraft), is eligible for a special rules apply. See section 168(m)(2)(C). • Property converted from business or
depreciation allowance of 100% of the income-producing use to personal use
depreciable basis of the property. The Qualified reuse and recycling in the same tax year it is acquired; or
property does not include rolling stock
special depreciation allowance for • Property for which you elected not to
or other equipment used to transport
certain qualified property (other than claim any special depreciation
reuse and recyclable materials or any
certain long production period property allowance.
property to which section 168(g) or (k)
and certain aircraft) placed in service In addition, qualified second
applies.
after December 31, 2022, and before generation biofuel plant property does
January 1, 2024, is limited to 80% of the Certain plants bearing fruits and not include the following.
depreciable basis of the property. nuts. You can elect to claim a 100% • Any tax-exempt bond financed
Qualified property is: special depreciation allowance for the property under section 103.
• Tangible property depreciated under adjusted basis of certain specified • Any property for which a deduction
MACRS with a recovery period of 20 plants (defined later) bearing fruits and was taken under section 179C for
years or less; nuts planted or grafted after September certain qualified refinery property.
• Computer software defined in and 27, 2017, and before January 1, 2023. • Other bonus depreciation property to
depreciated under section 167(f)(1); For certain specified plants bearing which section 168(k) applies.
• Water utility property (see 25-year fruits and nuts planted or grafted after
property, later); and December 31, 2022, and before See sections 168(k) and 168(m) for
• Qualified film, television, and live January 1, 2024, the special additional information. Also, see Pub.
theatrical productions, as defined in depreciation allowance is limited to 80% 946.
sections 181(d) and (e). of the adjusted basis of the specified How to figure the allowance. Figure
plants.
Qualified property must also be the special depreciation allowance by
placed in service before January 1, A specified plant is: multiplying the depreciable basis of the
2027 (or before January 1, 2028, for • Any tree or vine that bears fruits or property by the applicable percentage.
certain property with a long production nuts, and To figure the depreciable basis,
period and for certain aircraft), and can • Any other plant that will have more subtract from the business/investment
be either new property or certain used than one yield of fruits or nuts and portion of the cost or other basis of the
property. generally has a preproductive period of property any credits and deductions
more than 2 years from planting or
See Pub. 946 for more information. allocable to the property. The following
grafting to the time it begins bearing
Also, see section 168(k) and are examples of some credits and
fruits or nuts.
Regulations sections 1.168(k)-2 and deductions that reduce the depreciable
1.1502-68. Any property planted or grafted basis.
outside the United States does not • Section 179 expense deduction.
Qualified reuse and recycling qualify as a specified plant. • Deduction for removal of barriers to
property. Certain qualified reuse and the disabled and the elderly.
If you elect to claim the special
recycling property (defined below) Disabled access credit.
depreciation allowance for any specified •
placed in service after August 31, 2008, Enhanced oil recovery credit.
plant, the special depreciation •
is eligible for a 50% special depreciation Credit for employer-provided
allowance applies only for the tax year •
allowance. childcare facilities and services.
in which the plant is planted or grafted.
Qualified reuse and recycling The plant will not be treated as qualified • Basis adjustment to investment credit
property includes any machinery and property eligible for the special property under section 50(c).
equipment (not including buildings or • Section 181 expense deduction.

Instructions for Form 4562 (2022) -5-

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For additional credits and deductions Recapture. When you dispose of 50(c) to determine the basis adjustment
that affect the depreciable basis, see property for which you claimed a special for investment credit property.
section 1016. Also, see Pub. 946. depreciation allowance, any gain on the Line 16
disposition is generally recaptured
Note. If you acquired qualified property (included in income) as ordinary income Enter the total depreciation you are
through a like-kind exchange or up to the amount of the depreciation claiming for the following types of
involuntary conversion after September previously allowed or allowable for the property (except listed property and
27, 2017, and the qualified property is property, including the special property subject to a section 168(f)(1)
new property, the carryover basis and depreciation allowance. For more election).
any excess basis of the acquired information, see MACRS recapture, • ACRS property (pre-1987 rules). See
property is eligible for the special later. If qualified GO Zone property Pub. 534.
depreciation allowance. (including specified GO Zone property) • Property placed in service before
Generally, a like-kind exchange after ceases to be qualified GO Zone 1981.
December 31, 2017, is an exchange of property, if qualified Recovery • Certain public utility property which
real property. Assistance property ceases to be does not meet certain normalization
If you acquired qualified property qualified Recovery Assistance property, requirements.
through a like-kind exchange or if qualified cellulosic biomass ethanol • Certain property acquired from
involuntary conversion after September plant property ceases to be qualified related persons.
27, 2017, and the qualified property is cellulosic biomass ethanol plant • Property acquired in certain
used property, only the excess basis of property, if qualified second generation nonrecognition transactions.
the acquired property is eligible for the biofuel plant property ceases to be • Certain sound recordings, movies,
special depreciation allowance. qualified second generation biofuel and videotapes.
plant property, or if qualified disaster • Property depreciated under the
If you take the special assistance property ceases to be income forecast method. The use of the
! depreciation allowance, you qualified disaster assistance property in income forecast method is limited to
CAUTION must reduce the amount on motion picture films, videotapes, sound
any year after the year you claim the
which you figure your regular special depreciation allowance, the recordings, copyrights, books, and
depreciation or amortization deduction excess benefit you received from patents.
by the amount deducted. Also, you will claiming the special depreciation If you take the special
not have any AMT adjustment for allowance must be recaptured as ! depreciation allowance for a
depreciation for the qualified property. ordinary income. For information on CAUTION qualified film, television, or live
depreciation recapture, see Pub. 946. theatrical production, you must reduce
Election out. You can elect, for any
Also, see Notice 2008-25, 2008-9 I.R.B. the amount on which you figure your
class of property, to not deduct any
484, available at IRS.gov/irb/ regular depreciation deduction by the
special depreciation allowance for all
2008-09_IRB/ar10.html, for additional amount deducted.
such property in such class placed in
guidance on recapture of qualified GO
service during the tax year. If you use the income forecast
Zone property.
To make an election, attach a method for any property placed in
statement to your timely filed return Line 15 service after September 13, 1995, you
(including extensions) indicating the Report on this line depreciation for may owe interest or be entitled to a
class of property for which you are property that you elect to depreciate refund for the 3rd and 10th tax years
making the election and that, for such under the unit-of-production method or beginning after the tax year the property
class, you are not to claim any special any other method not based on a term was placed in service. For details, see
depreciation allowance. of years (other than the Form 8866, Interest Computation Under
The election must be made retirement-replacement-betterment the Look-Back Method for Property
separately by each person owning method). Depreciated Under the Income Forecast
qualified property (for example, by the Method.
partnership, by the S corporation, or for Attach a separate sheet showing: For property placed in service in the
each member of a consolidated group • A description of the property and the current tax year, you can either include
by the common parent of the group). depreciation method you elect that certain participations and residuals in
excludes the property from MACRS or the adjusted basis of the property or
If you timely filed your return without ACRS; and deduct these amounts when paid. See
making an election, you can still make • The depreciable basis (cost or other section 167(g)(7). You cannot use this
the election by filing an amended return basis reduced, if applicable, by salvage method to depreciate any amortizable
within 6 months of the due date of the value, any section 179 expense section 197 intangible. For more details,
return (excluding extensions). Enter deduction, deduction for removal of see the instructions for section 197
“Filed pursuant to section 301.9100-2” barriers to the disabled and the elderly, intangibles, later.
on the amended return. disabled access credit, enhanced oil • Intangible property, other than
Once made, the election cannot be recovery credit, credit for section 197 intangibles, including the
revoked without IRS consent. employer-provided childcare facilities following.
and services, any special depreciation
Note. If you elect to not have any allowance, and any other applicable 1. Computer software. Use the
special depreciation allowance apply, deduction or credit). straight line method over 36 months. A
the property placed in service during the longer period may apply to software
tax year will not be subject to an AMT For additional credits and deductions leased under a lease agreement
adjustment for depreciation. that may affect the depreciable basis, entered into after March 12, 2004, to a
see section 1016. Also, see section tax-exempt organization, governmental

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unit, or foreign person or entity (other asset by the basis and depreciation carryover basis of property you acquire
than a partnership). See section 167(f) reserve attributable to the disposed in a like-kind exchange or involuntary
(1)(C). portion as of the first day of the tax year conversion during the current tax year
before you compute the depreciation over the remaining recovery period of
If you elect the section 179
deduction for the current year. To figure the property exchanged or involuntarily
! expense deduction or take the the depreciation deduction for the converted. Use the same depreciation
CAUTION special depreciation allowance
remaining MACRS asset and the method and convention that was used
for qualified computer software, you
disposed portion, see the instructions for the exchanged or involuntarily
must reduce the amount on which you
for line 19, column (g). For more converted property. Treat any excess
figure your regular depreciation
information, see Regulations section basis as newly placed in service
deduction by the amount deducted.
1.168(i)-8. property. Figure depreciation separately
for the carryover basis and the excess
2. Any right to receive tangible Line 18 basis, if any.
property or services under a contract or
granted by a governmental unit (not To simplify the computation of MACRS These rules apply only to acquired
acquired as part of a business). depreciation, you can elect to group property with the same or a shorter
assets into one or more general asset recovery period or the same or a more
3. Any interest in a patent or accounts. The assets in each general accelerated depreciation method than
copyright not acquired as part of a asset account are depreciated as a the property exchanged or involuntarily
business. single asset. converted. For additional rules, see
4. Residential mortgage servicing
rights. Use the straight line method over Each general asset account must Regulations section 1.168(i)-6(c) and
108 months. include only assets that were placed in Pub. 946.
service during the same tax year and Election out. Instead of using the
5. Other intangible assets with a that have the same depreciation above rules, you can elect, for
limited useful life that cannot be method, recovery period, and depreciation purposes, to treat the
estimated with reasonable accuracy. convention. However, an asset cannot adjusted basis of the exchanged
Generally, use the straight line method be included in a general asset account if property as if it was disposed of at the
over 15 years. See Regulations section the asset is used both for personal time of the exchange or involuntary
1.167(a)-3(b) for details and exceptions. purposes and business/investment conversion. Generally, treat the
Prior years' depreciation, plus purposes. carryover basis and excess basis, if
! current year's depreciation, can When an asset in an account is any, for the acquired property as if
CAUTION never exceed the depreciable
disposed of, the amount realized must placed in service on the date you
basis of the property. generally be recognized as ordinary acquired it. The depreciable basis of the
income. The unadjusted depreciable new property is the adjusted basis of the
Part III. MACRS basis and depreciation reserve of the exchanged or involuntarily converted
general asset account are not affected property plus any additional amount
Depreciation paid for it. See Regulations section
as a result of a disposition.
1.168(i)-6(i).
Special rules apply to passenger
The term “Modified Accelerated Cost automobiles, assets generating foreign To make the election, figure the
Recovery System” (MACRS) includes source income, assets converted to depreciation deduction for the new
the General Depreciation System (GDS) personal use, certain asset dispositions, property in Part III. For listed property,
and the Alternative Depreciation System and like-kind exchanges or involuntary use Part V. Attach a statement
(ADS). Generally, MACRS is used to conversions of property in a general indicating “Election made under section
depreciate any tangible property placed asset account. For more details, see 1.168(i)-6(i)” for each property involved
in service after 1986. However, MACRS Regulations section 1.168(i)-1 (as in in the exchange or involuntary
does not apply to films, videotapes, and effect for tax years beginning on or after conversion. The election must be made
sound recordings. For more details and January 1, 2014). separately by each person acquiring
exceptions, see Pub. 946. replacement property (for example, by
To make the election, check the box the partnership, by the S corporation, or
on line 18. You must make the election by the common parent of a consolidated
Section A on your return filed no later than the due group). The election must be made on
date (including extensions) for the tax your timely filed return (including
Line 17 year in which the assets included in the extensions). Once made, the election
general asset account were placed in cannot be revoked without IRS consent.
For tangible property placed in service service. Once made, the election is Generally, a like-kind exchange
in tax years beginning before 2022 and irrevocable and applies to the tax year ! after December 31, 2017, is an
depreciated under MACRS (“MACRS for which the election is made and all CAUTION exchange of real property.
asset”), enter the deductions for the later tax years.
current year. To figure the deductions,
see the instructions for line 19, column For more information on depreciating Lines 19a Through 19i
(g). property in a general asset account, see Use lines 19a through 19i only for
Pub. 946. assets placed in service during the tax
Note. If you dispose of a portion of a year beginning in 2022 and depreciated
MACRS asset and are required to (or Section B
under GDS, except for automobiles and
elect to) take the basis of the asset into Property acquired in a like-kind ex- other listed property (which are reported
account, you must reduce the basis and change or involuntary conversion. in Part V).
depreciation reserve of the MACRS Generally, you must depreciate the

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Column (a)—Classification of prop- • Any property that does not have a Nonresidential real property is any
erty. Sort the property you acquired class life and is not otherwise classified. real property that is neither residential
and placed in service during the tax 10-year property includes the rental property nor property with a class
year beginning in 2022 according to its following. life of less than 27.5 years.
classification (3-year property, 5-year • Vessels, barges, tugs, and similar 50-year property includes any
property, etc.) as shown in column (a) of water transportation equipment. improvements necessary to construct or
lines 19a through 19i. The • Any single purpose agricultural or improve a roadbed or right-of-way for
classifications for some property are horticultural structure (see section 168(i) railroad track that qualifies as a railroad
shown below. For property not shown, (13)). grading or tunnel bore under section
see Determining the classification, later. • Any tree or vine bearing fruits or nuts. 168(e)(4).
3-year property includes the • Any qualified smart electric meter There is no separate line to report
following. property. 50-year property. Therefore, attach a
• A race horse that is more than 2 • Any qualified smart electric grid statement showing the same
years old at the time. system property. information as required in columns (a)
• Any horse (other than a race horse) 15-year property includes the through (g). Include the deduction in the
that is more than 12 years old at the following. line 22 “Total” and enter “See
time it is placed in service. • Any municipal wastewater treatment attachment” in the bottom margin of the
• Any qualified rent-to-own property (as plant. form.
defined in section 168(i)(14)). • Any telephone distribution plant and
Determining the classification. If
5-year property includes the comparable equipment used for 2-way
your depreciable property is not listed
following. exchange of voice and data
above, determine the classification as
• Automobiles. communications.
follows.
• Light general purpose trucks. • Any section 1250 property that is a
• Typewriters, calculators, copiers, and retail motor fuels outlet (whether or not 1. Find the property's class life. See
duplicating equipment. food or other convenience items are the Table of Class Lives and Recovery
• Any semi-conductor manufacturing sold there). Periods in Pub. 946.
equipment. • Initial clearing and grading land 2. Use the following table to find the
• Any qualified technological improvements for gas utility property. classification in column (b) that
equipment. • Certain electric transmission property corresponds to the class life of the
• Any section 1245 property used in specified in section 168(e)(3)(E)(v) property in column (a).
connection with research and placed in service after April 11, 2005,
experimentation. the original use of which begins with you (a) (b)
• Certain energy property specified in after April 11, 2005, and is not under Class life (in years) Classification
section 168(e)(3)(B)(vi). self-construction or subject to a binding (See Pub. 946.)
• Appliances, carpets, furniture, etc., contract in existence before April 12, 4 or less . . . . . . . . . . 3-year property
used in a rental real estate activity. 2005. More than 4 but less than 5-year property
10 . . . . . . . . . . . . . .
• Any new machinery or equipment • Qualified improvement property, as 10 or more but less than 7-year property
(other than any grain bin, cotton ginning defined in section 168(e)(6), placed in 16 . . . . . . . . . . . . . .
asset, fence, or other land service by you after December 31, 16 or more but less than 10-year property
improvement) used in a farming 2017. 20 . . . . . . . . . . . . . .
business and placed in service after 20-year property includes the 20 or more but less than 15-year property
2017, in tax years ending after 2017. following. 25 . . . . . . . . . . . . . .
The original use of the property must • Farm buildings (other than single 25 or more . . . . . . . . . 20-year property
begin with you after 2017. purpose agricultural or horticultural
7-year property includes the structures).
following. • Municipal sewers not classified as Column (b)—Month and year placed
• Office furniture and equipment. 25-year property. in service. For lines 19h and 19i, enter
• Railroad track. • Initial clearing and grading land the month and year you placed the
• Any motorsports entertainment improvements for electric utility property in service. If you converted
complex (as defined in section 168(i) transmission and distribution plants. property held for personal use to use in
(15)). 25-year property is water utility a trade or business or for the production
• Any natural gas gathering line (as property, which is: of income, treat the property as being
defined in section 168(i)(17)) placed in • Property that is an integral part of the placed in service on the conversion
service after April 11, 2005, the original gathering, treatment, or commercial date.
use of which begins with you after April distribution of water that, without regard Column (c)—Basis for depreciation
11, 2005, and is not under to this classification, would be 20-year (business/investment use only). To
self-construction or subject to a binding property; and find the basis for depreciation, multiply
contract in existence before April 12, • Municipal sewers. the cost or other basis of the property by
2005. Also, no AMT adjustment is This classification does not apply to the percentage of business/investment
required. property placed in service under a use. From that result, subtract any
• Any used agricultural machinery and binding contract in effect at all times credits and deductions allocable to the
equipment placed in service after 2017, since June 9, 1996. property. The following are examples of
grain bins, cotton ginning assets, or Residential rental property is a some credits and deductions that
fences used in a farming business (but building in which 80% or more of the reduce the basis for depreciation.
no other land improvements). total rent is from dwelling units. • Section 179 expense deduction.

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• Deduction under section 179D for tax year as placed in service (or smart electric meter or any qualified
certain energy efficient commercial disposed of) on the midpoint of that tax smart electric grid system property
building property. year. Enter “HY” in column (e). placed in service after October 3, 2008.
• Deduction for removal of barriers to For 3-, 5-, 7-, or 10-year property
the disabled and the elderly. Mid-quarter convention. If the total
• Disabled access credit. depreciable bases (before any special eligible for the 200% declining balance
• Enhanced oil recovery credit. depreciation allowance) of MACRS method, you can make an irrevocable
• Credit for alternative fuel vehicle property placed in service during the election to use the 150% declining
refueling property. last 3 months of your tax year exceed balance method, switching to the
• Credit for employer-provided 40% of the total depreciable bases of straight line method in the first tax year
childcare facilities and services. MACRS property placed in service that the straight line rate exceeds the
• Any special depreciation allowance during the entire tax year, the declining balance rate. The election
included on line 14. mid-quarter, instead of the half-year, applies to all property within the
• Any basis adjustment for investment convention generally applies. classification for which it is made and
that was placed in service during the tax
credit property. See section 50(c). In determining whether the year. You will not have an AMT
• Any basis adjustment for advanced mid-quarter convention applies, do not adjustment for any property included
manufacturing investment credit take into account the following. under this election.
property. See section 48D(d)(5). • Property that is being depreciated
For additional credits and deductions under a method other than MACRS. For 3-, 5-, 7-, or 10-year property
that affect the depreciable basis, see • Any residential rental property, used in a farming business and placed
section 1016 and Pub. 946. nonresidential real property, or railroad in service after 2017, in tax years ending
gradings and tunnel bores. after 2017, the 150% declining balance
Column (d)—Recovery period. • Property that is placed in service and method is no longer required. However,
Determine the recovery period from the disposed of within the same tax year. the 150% declining balance method will
continue to apply to any 15- or 20-year
following table. See Pub. 946 for more The mid-quarter convention treats all property used in a farming business to
information on the recovery period for property placed in service (or disposed which the straight line method does not
MACRS property. of) during any quarter as placed in apply or to property for which you elect
service (or disposed of) on the midpoint the use of the 150% declining balance
Recovery Period for Most of that quarter. However, no method.
Property depreciation is allowed under this 15- and 20-year property and
•
convention for property that is placed in property used in a farming business.
Recovery service and disposed of within the same The applicable method is the 150%
Classification period tax year. Enter “MQ” in column (e). declining balance method, switching to
3-year property . . . . . . . . 3 yrs.
5-year property . . . . . . . . 5 yrs. Mid-month convention. This the straight line method in the first tax
7-year property . . . . . . . . 7 yrs. convention applies only to residential year that the straight line rate exceeds
10-year property . . . . . . . 10 yrs. rental property (line 19h), nonresidential the declining balance rate. For 3-, 5-, 7-,
15-year property . . . . . . . 15 yrs. real property (line 19i), and railroad and 10-year property used in a farming
20-year property . . . . . . . 20 yrs. gradings and tunnel bores. It treats all business and placed in service after
25-year property . . . . . . . 25 yrs. property placed in service (or disposed 2017, see 3-, 5-, 7-, or 10-year property
Residential rental of) during any month as placed in above.
property . . . . . . . . . . . . 27.5 yrs. service (or disposed of) on the midpoint • Water utility property, residential
Nonresidential real of that month. Enter “MM” in column (e). rental property, nonresidential real
property . . . . . . . . . . . . 39 yrs. property, or any railroad grading or
Railroad gradings and tunnel Column (f)—Method. Applicable tunnel bore. The only applicable
bores . . . . . . . . . . . . . . 50 yrs. depreciation methods are prescribed for method is the straight line method.
each classification of property as
Column (e)—Convention. The follows. However, you can make an Column (g)—Depreciation deduc-
applicable convention determines the irrevocable election to use the straight tion. To figure the depreciation
portion of the tax year for which line method for all property within a deduction, you may use optional Tables
depreciation is allowable during a year classification that is placed in service A through E, which begin later. Multiply
property is either placed in service or during the tax year. Enter “200 DB” for column (c) by the applicable rate from
disposed of. There are three types of 200% declining balance, “150 DB” for the appropriate table. See Pub. 946 for
conventions. To select the correct 150% declining balance, or “S/L” for complete tables. If you disposed of the
convention, you must know the type of straight line. property during the current tax year,
property and when you placed the • 3-, 5-, 7-, and 10-year property. multiply the result by the applicable
property in service. Generally, the applicable method is the decimal amount from the tables in Step
200% declining balance method, 3, later. Or, you may compute the
Half-year convention. This switching to the straight line method in deduction yourself by completing the
convention applies to all property the first tax year that the straight line following steps.
reported on lines 19a through 19g, rate exceeds the declining balance rate. Step 1. Determine the depreciation
unless the mid-quarter convention
applies. It does not apply to residential Note. The straight line method is the rate as follows.
rental property, nonresidential real only applicable method for trees and • If you are using the 200% or 150%
property, and railroad gradings and vines bearing fruits or nuts. The 150% declining balance method in column (f),
tunnel bores. It treats all property placed declining balance method is the only divide the declining balance rate (use
in service (or disposed of) during any applicable method for any qualified 2.00 for 200 DB or 1.50 for 150 DB) by
the number of years in the recovery

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period in column (d). For example, for Section C Use line 20a for all property
property depreciated using the 200 DB depreciated under ADS, except
method over a recovery period of 5 property that does not have a class life,
years, divide 2.00 by 5 for a rate of 40%. Lines 20a Through 20d residential rental and nonresidential real
You must switch to the straight line rate Complete lines 20a through 20d for property, water utility property, and
in the first year that the straight line rate assets, other than automobiles and railroad gradings and tunnel bores. Use
exceeds the declining balance rate. other listed property, placed in service line 20b for property that does not have
• If you are using the straight line only during the tax year beginning in a class life. Use line 20c for residential
method, divide 1.00 by the remaining 2022 and depreciated under ADS. rental property. Use line 20d for
number of years in the recovery period Report on line 17 MACRS depreciation nonresidential real property.
as of the beginning of the tax year (but on assets placed in service in prior
not less than 1). For example, if there years. Residential rental property. The
are 6 / years remaining in the recovery 1 2 ADS recovery period for residential
period as of the beginning of the year, Under ADS, use the applicable rental property placed in service after
divide 1.00 by 6.5 for a rate of 15.38%. depreciation method, the applicable 2017 is 30 years. The ADS recovery
recovery period, and the applicable period for residential rental property
Step 2. Multiply the percentage rate convention to compute depreciation. placed in service before January 1,
determined in Step 1 by the property's 2018, is 30 years if the property is held
unrecovered basis (basis for The following types of property must by an electing real property trade or
depreciation (as defined in column (c)) be depreciated under ADS. business (as defined in section 163(j)(7)
reduced by all prior years' depreciation. • Tangible property used (B)) and section 168(g)(1)(A), (B), (C),
predominantly outside the United (D), or (E) did not apply to the property
Step 3. For property placed in States. before January 1, 2018. Report
service or disposed of during the current • Tax-exempt use property. depreciation for these assets on
tax year, multiply the result from Step 2 • Tax-exempt bond financed property. line 20c. For more information, see Pub.
by the applicable decimal amount from • Imported property covered by an 946.
the tables below (based on the executive order of the President of the
convention shown in column (e)). United States. Water utility property and railroad
• Property used predominantly in a gradings and tunnel bores. These
Half-year (HY) convention. . . . . . . 0.5 farming business and placed in service assets are 50-year property under ADS.
Mid-quarter (MQ) during any tax year in which you made There is no separate line to report
convention an election under section 263A(d)(3) to 50-year property. Therefore, attach a
Placed in service Placed not have the uniform capitalization rules statement showing the same
(or disposed of) in Disposed of section 263A apply. information required in columns (a)
during the: service of • Any nonresidential real property, through (g). Include the deduction in the
1st quarter . . . 0.875 0.125 residential rental property, or qualified line 22 “Total” and enter “See
2nd quarter . . 0.625 0.375 improvement property held by an attachment” in the bottom margin of the
3rd quarter . . . 0.375 0.625 electing real property trade or business form.
4th quarter . . . 0.125 0.875 (as defined in section 163(j)(7)(B)). Column (b)—Month and year placed
• Any property that has a recovery in service. For residential rental
period of 10 years or more under property and 40-year property, enter the
section 168(c) that is held by an electing month and year placed in service or
Mid-month (MM) farming business (as defined in section converted to use in a trade or business
convention 163(j)(7)(C)). or for the production of income.
Placed in service Placed
(or disposed of) in Disposed Instead of depreciating property Column (c)—Basis for depreciation
during the: service of under GDS (line 19), you can make an (business/investment use only). See
1st month . . . . 0.9583 0.0417 irrevocable election for any the instructions for line 19, column (c).
2nd month . . . . 0.8750 0.1250 classification of property for any tax year Column (d)—Recovery period. On
3rd month . . . . 0.7917 0.2083 to use ADS. For residential rental and line 20a, enter the property's class life.
4th month . . . . 0.7083 0.2917 nonresidential real property, you can
5th month . . . . 0.6250 0.3750 make this election separately for each Column (e)—Convention. Under
6th month . . . . 0.5417 0.4583 property. You make this election by ADS, the applicable conventions are the
7th month . . . . 0.4583 0.5417 same as those used under GDS. See
8th month . . . . 0.3750 0.6250 completing line 20 of Form 4562.
the instructions for line 19, column (e).
9th month . . . . 0.2917 0.7083 Column (a)—Classification of prop-
10th month. . . . 0.2083 0.7917 erty. Use the following rules to Column (g)—Depreciation deduc-
11th month. . . . 0.1250 0.8750 determine the classification of the tion. Figure the depreciation deduction
12th month. . . . 0.0417 0.9583 property under ADS. in the same manner as under GDS,
Under ADS, the depreciation except use the straight line method over
deduction for most property is based on the ADS recovery period and use the
Short tax years. See Pub. 946 for the property's class life. See section applicable convention.
rules on how to compute the 168(g)(3) for special rules for MACRS recapture. If you later dispose
depreciation deduction for property determining the class life for certain of property you depreciated using
placed in service in a short tax year. property. See Pub. 946 for information MACRS, any gain on the disposition is
on recovery periods for ADS and the generally recaptured (included in
Table of Class Lives and Recovery income) as ordinary income up to the
Periods.

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amount of the depreciation previously depreciation deduction. See the • The use of the property as
allowed or allowable for the property. instructions for line 26, column (i). compensation for services performed by
Depreciation, for this purpose, includes any person (who is not a 5% owner or
any of the following amounts taken Listed property used 50% or less in a related person), unless an amount is
during the 2022 tax year. qualified business use (as defined in the included in that person's income for the
• Any section 179 expense deduction instructions for lines 26 and 27 below) use of the property and, if required,
claimed on the property. does not qualify for the section 179 income tax was withheld on that
• Any special depreciation allowance expense deduction or special amount.
available for the property (unless you depreciation allowance.
elected not to claim it). Excluding these uses above from the
• Any deduction under section 179B for Line 25 numerator, determine your percentage
capital costs incurred in complying with If you placed in service certain qualified of qualified business use similar to the
Environmental Protection Agency sulfur listed property during the tax year, you method used to figure the business/
regulations. may be able to deduct the special investment use percentage in column
There is no recapture for residential depreciation allowance. This property (c). Your percentage of qualified
rental and nonresidential real property, includes certain qualified property business use may be smaller than the
unless that property is qualified property acquired after September 27, 2017, and business/investment use percentage.
for which you claimed a special placed in service before January 1,
depreciation allowance (discussed 2027 (before January 1, 2028, for For more information, including the
earlier). For more information on certain aircraft). See the instructions for definition of a 5% owner and related
depreciation recapture, see Pub. 946. line 14 for the definition of qualified person and exceptions, see Pub. 946.
property and how to figure the Listed property recapture. If you
deduction. This special depreciation used listed property more than 50% in a
Part IV. Summary allowance is included in the overall limit qualified business use in the year you
Line 22 on depreciation and section 179 placed the property in service, and used
A partnership or S corporation does not expense deduction for passenger it 50% or less in a later year, you may
include any section 179 expense automobiles. See the tables for have to include as income part of the
deduction (line 12) on this line. Instead, limitations on passenger vehicles and depreciation, including the special
any section 179 expense deduction is trucks and vans, later. Enter on line 25 depreciation allowance, deducted in
passed through separately to the your total special depreciation prior years. Use Form 4797, Sales of
partners and shareholders on the allowance for all qualified listed Business Property, to figure the
appropriate line of their Schedules K-1. property. recapture amount.
Line 23 Lines 26 and 27 Column (a)—Type of property. List
If you are subject to the uniform Use line 26 to figure depreciation for on a property-by-property basis all your
capitalization rules of section 263A, property used more than 50% in a listed property in the following order.
enter the increase in basis from costs qualified business use. Use line 27 to 1. Automobiles and other vehicles.
you must capitalize. For a detailed figure the depreciation for property used 2. Other listed property (computers
discussion of who is subject to these 50% or less in a qualified business use. and peripheral equipment placed in
rules, which costs must be capitalized, Also, see Limits for passenger service before 2018, etc.).
and allocation of costs among activities, automobiles, later.
In column (a), list the makes and
see Regulations section 1.263A-1. If you acquired the property models of automobiles, and give a
through a trade-in, special rules
Part V. Listed Property CAUTION! apply for determining the basis, general description of other listed
property.
recovery period, depreciation method,
If you claim the standard mileage and convention. For more details, see If you have more than five vehicles
rate, actual vehicle expenses (including Property acquired in a like-kind used 100% for business/investment
depreciation), or depreciation on other exchange or involuntary conversion, purposes, you may group them by tax
listed property, you must provide the earlier. Also, see Regulations section year. Otherwise, list each vehicle
information requested in Part V, 1.168(i)-6(d)(3). separately.
regardless of the tax year the property
Column (b)—Date placed in service.
was placed in service. However, if you Qualified business use. To determine Enter the date the property was placed
file Form 2106, report this information whether to use line 26 or line 27 to in service. If property held for personal
on that form and not in Part V. Also, if report your listed property, you must first use is converted to business/investment
you file Schedule C (Form 1040) and determine the percentage of qualified use, treat the property as placed in
are claiming the standard mileage rate business use for each property. service on the date of conversion.
or actual vehicle expenses (except Generally, a qualified business use is
depreciation), and you are not required any use in your trade or business. Column (c)—Business/investment
to file Form 4562 for any other reason, However, it does not include any of the use percentage. Enter the percentage
report vehicle information in Part IV of following. of business/investment use. For
Schedule C and not on Form 4562. • Investment use. automobiles and other vehicles,
Section A • Leasing the property to a 5% owner determine this percentage by dividing
or related person. the number of miles the vehicle is driven
The section 179 expense • The use of the property as for trade or business purposes or for the
! deduction should be computed compensation for services performed by production of income during the year
CAUTION before calculating any special (not to include any commuting mileage)
a 5% owner or related person.
depreciation allowance and/or regular by the total number of miles the vehicle

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is driven for all purposes. Treat vehicles use the table in the instructions for (h) and (i) on line 26 or 27 and column
used by employees as being used line 19, column (d). For property placed (h) on line 25 for that automobile cannot
100% for business/investment purposes in service after 1986 and used 50% or exceed the applicable limit shown in
if the value of personal use is included less in a qualified business use, Table 1, 2, 3, or 4. If the business/
in the employees' gross income, or the depreciate the property using the investment use percentage in column
employees reimburse the employer for straight line method over its ADS (c) for the automobile is less than 100%,
the personal use. For more information, recovery period. The ADS recovery you must reduce the applicable limit to
see Pub. 463. period is 5 years for automobiles and an amount equal to the limit multiplied
For other listed property (such as computers. by that percentage. For example, for an
automobile (including a truck or van)
computers placed in service before Column (g)—Method/convention.
placed in service in 2022 (for which you
2018 or video equipment), allocate the Enter the method and convention used
elect not to claim any special
use based on the most appropriate unit to figure your depreciation deduction.
depreciation allowance) that is used
of time the property is actually used See the instructions for line 19, columns
60% for business/investment, the limit is
(rather than merely being available for (e) and (f). Enter “200 DB,” “150 DB,” or
$6,720 ($11,200 x 60% (0.60)).
use). “S/L” for the depreciation method, and
If during the tax year you convert “HY,” “MM,” or “MQ” for half-year, For purposes of the limits for
property used solely for personal mid-month, or mid-quarter conventions, passenger automobiles, the following
purposes to business/investment use respectively. For property placed in apply.
(or vice versa), figure the percentage of service before 1987, enter “PRE” if you • Passenger automobiles are
business/investment use only for the used the prescribed percentages under 4-wheeled vehicles manufactured
number of months you use the property ACRS. If you elected an alternate primarily for use on public roads that are
in your business or for the production of percentage or if you are required to rated at 6,000 pounds unloaded gross
income. Multiply that percentage by the depreciate the property using the vehicle weight or less (for a truck or van,
number of months you use the property straight line method, enter “S/L.” gross vehicle weight is substituted for
unloaded gross vehicle weight).
in your business or for the production of Column (h)—Depreciation deduc- • Electric passenger automobiles are
income, and divide the result by 12. tion. See Limits for passenger vehicles produced by an original
Column (d)—Cost or other basis. automobiles, later, before entering an equipment manufacturer and designed
Enter the property's actual cost amount in column (h). to run primarily on electricity, placed in
(including sales tax) or other basis For property used more than 50% in service after August 5, 1997, and before
(unadjusted for prior years' a qualified business use (line 26) and January 1, 2007.
depreciation). If you traded in old placed in service after 1986, figure
property, see Property acquired in a column (h) by following the instructions Exception. The following vehicles
like-kind exchange or involuntary for line 19, column (g). If placed in are not considered passenger
conversion, earlier. service before 1987, multiply column (e) automobiles.
For a vehicle, reduce your basis by by the applicable percentage given in • An ambulance, hearse, or
any qualified electric vehicle credit you Pub. 534 for ACRS property. If the combination ambulance-hearse used in
claimed for property placed in service recovery period for an automobile your trade or business.
before January 1, 2007, or by any ended before your tax year beginning in • A vehicle used in your trade or
alternative motor vehicle credit allowed. 2022, enter your unrecovered basis, if business of transporting persons or
If you converted the property from any, in column (h). property for compensation or hire.
• Any truck or van placed in service
personal use to business/investment For property used 50% or less in a after July 6, 2003, that is a qualified
use, your basis for depreciation is the qualified business use (line 27) and nonpersonal use vehicle. A truck or van
smaller of the property's adjusted basis placed in service after 1986, figure is a qualified nonpersonal use vehicle
or its fair market value on the date of column (h) by dividing the amount in only if it has been specially modified
conversion. column (e) by the amount in column (f). with the result that it is not likely to be
Use the same conventions as discussed used more than a de minimis amount for
Column (e)—Basis for depreciation in the instructions for line 19, column personal purposes. For example, a van
(business/investment use only). (e). The amount in column (h) cannot that has only a front bench for seating,
Multiply column (d) by the percentage in exceed the property's unrecovered in which permanent shelving has been
column (c). From that result, subtract basis. If the recovery period for an installed, that constantly carries
any section 179 expense deduction, any automobile ended before your tax year merchandise or equipment, and that
special depreciation allowance, any beginning in 2022, enter your has been specially painted with
credit for employer-provided childcare unrecovered basis, if any, in column (h). advertising or the company's name, is a
facilities and services, and half of any
investment credit taken before 1986 For property placed in service before vehicle not likely to be used more than a
(unless you claimed the reduced credit). 1987 that was disposed of during the de minimis amount for personal
For automobiles and other listed year, enter zero. purposes.
property placed in service after 1985 Limits for passenger automobiles. Exception for leasehold property.
(that is, transition property), reduce the The depreciation deduction, including The business use requirement and the
depreciable basis by the entire the section 179 expense deduction and limits for passenger automobiles
investment credit. special depreciation allowance, for generally do not apply to passenger
Column (f)—Recovery period. Enter passenger automobiles is limited. For automobiles leased or held by anyone
the recovery period. For property placed any passenger automobile (including an regularly engaged in the business of
in service after 1986 and used more electric passenger automobile) you list leasing passenger automobiles.
than 50% in a qualified business use, on line 26 or line 27, the total of columns

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For a detailed discussion on Table 3—Limits for Passenger not more than 14,000 pounds gross
passenger automobiles, including Automobiles Placed in Service vehicle weight. However, the $27,000
leased automobiles, see Pub. 463. limit does not apply to any vehicle:
After 2003 and Before 2018 Designed to seat more than nine
•
Table 1—Limits for Passenger (excluding trucks and vans placed in persons behind the driver's seat;
Automobiles (including trucks and service after 2002 and electric • Equipped with a cargo area (either
vans) Acquired Before September passenger automobiles placed in open or enclosed by a cap) of at least 6
28, 2017, and Placed in Service service before January 1, 2007) feet in interior length that is not readily
accessible directly from the passenger
Before 2020 compartment; or
AND the THEN the • That has an integral enclosure fully
number of
AND the
IF you placed number of tax THEN the IF you placed tax years in limit on your enclosing the driver compartment and
your years in which limit on your your automobile which this depreciation load carrying device, does not have
automobile in this depreciation in service: automobile and section
service: automobile and section has been in 179 expense seating rearward of the driver's seat,
has been 179 expense service is: deduction is: and has no body section protruding
more than 30 inches ahead of the
in service is: deduction is: Jan. 1, 2004–Dec. 4 or more $1,675 leading edge of the windshield.
31, 2005
Jan. 1–Dec. 31, 3 $9,600 Recapture of section 179 expense
2018 4 or more $5,760 31, 2011 4 or more $1,775
Jan. 1, 2006–Dec.
deduction. If you used listed property
more than 50% in a qualified business
Jan. 1–Dec. 31, 3 $9,700 Jan. 1, 2012–Dec. 4 or more $1,875
2019 4 or more $5,760 31, 2017 use in the year you placed the property
in service and used it 50% or less in a
later year, you may have to recapture in
Table 2—Limits for Passenger Table 4—Limits for Trucks and the later year part of the section 179
Automobiles (including trucks and Vans Placed in Service After 2002 expense deduction. Use Form 4797 to
vans) Acquired After September and Before 2018 figure the recapture amount.
27, 2017, and Placed in Service Section B
AND the
Before 2023 number of THEN the Except as noted below, you must
IF you placed tax years in limit on your
AND the your truck or van which this depreciation complete lines 30 through 36 for each
number of THEN the in service: truck or van and section vehicle identified in Section A.
tax years in limit on your has been in 179 expense Employees must provide their
which this depreciation service is: deduction is: employers with the information
requested on lines 30 through 36 for
IF you placed automobile and section Jan. 1, 2004–Dec. 4 or more $1,875 each automobile or vehicle provided for
your automobile has been in 179 expense 31, 2008
in service: service is: deduction is: their use.
Jan. 1–Dec. 31, 4 or more $1,775
Jan. 1–Dec. 31, 3 $9,600 2009 Exception. Employers are not required
2018 4 or more $5,760 Jan. 1, 2010–Dec. 4 or more $1,875 to complete lines 30 through 36 for
Jan. 1–Dec. 31, 3 $9,700 31, 2012 vehicles used by employees who are
2019 4 or more $5,760 Jan. 1, 2013–Dec. 4 or more $1,975 not more than 5% owners or related
31, 2015 persons and for which the question on
Jan. 1–Dec. 31, 3 $9,700 line 37, 38, 39, 40, or 41 is answered
Jan. 1–Dec. 31, 4 or more $2,075
2020 4 or more $5,760 2016 “Yes.”
Jan. 1–Dec. 31, 2 $16,400 Jan. 1–Dec. 31, 3 $3,450 Section C
2021 3 $9,800 2017 4 or more $2,075 Employers providing vehicles to their
Jan. 1–Dec. 31, 1 $11,200* employees satisfy the employer's
2022 2 $18,000 substantiation requirements under
* If you take the special depreciation allowance for Column (i)—Elected section 179 section 274(d) by maintaining a written
qualified passenger automobiles acquired after cost. Enter the amount you elect to policy statement that:
September 27, 2017, and placed in service in 2022, the expense for section 179 property used • Prohibits personal use including
limit is $19,200. more than 50% in a qualified business commuting, or
use (subject to the limits for passenger • Prohibits personal use except for
automobiles). Refer to the instructions commuting.
for Part I to determine if the property
An employee does not need to keep
qualifies under section 179.
a separate set of records for any vehicle
You cannot elect to expense more that satisfies these written policy
than $27,000 of the cost of any SUVs statement rules.
and certain other vehicles placed in
service during the tax year. This rule For both written policy statements,
applies to any 4-wheeled vehicle there must be evidence that would
primarily designed or used to carry enable the IRS to determine whether
passengers over public streets, roads, use of the vehicle meets the conditions
or highways, that is rated at more than stated below.
6,000 pounds gross vehicle weight and

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Line 37 not complete Section B for such (84 months for certain atmospheric
A policy statement that prohibits vehicles. Instead, the employer must pollution control facilities placed in
personal use (including commuting) obtain the information from its service after April 11, 2005). See
must meet all of the following employees and retain the information section 169 and the related regulations
conditions. received. for details and information required in
making the election. See Pub. 535 for
• The employer owns or leases the Line 41 more information.
vehicle and provides it to one or more An automobile meets the requirements
employees for use in the employer's for qualified demonstration use if the You can deduct a special
trade or business. employer maintains a written policy ! depreciation allowance on a
• When the vehicle is not used in the statement that: CAUTION certified pollution control facility
employer's trade or business, it is kept Prohibits its use by individuals other that is qualified property. However, you
•
on the employer's business premises, than full-time automobile salespersons, must reduce the amount on which you
unless it is temporarily located Prohibits its use for personal vacation figure your amortization deduction by
•
elsewhere (for example, for trips, any special depreciation allowance
maintenance or because of a Prohibits storage of personal allowed or allowable, whichever is
•
mechanical failure). possessions in the automobile, and greater.
• No employee using the vehicle lives Limits the total mileage outside the
•
at the employer's business premises. salesperson's normal working hours. Also, a corporation must reduce its
• No employee may use the vehicle for amortizable basis of a pollution control
personal purposes, other than de facility by 20% before figuring the
minimis personal use (for example, a Part VI. Amortization
amortization deduction.
stop for lunch between two business
Bond premium (section 171). For
deliveries). Each year, you can deduct part of individuals reporting amortization of
• Except for de minimis use, the certain capital costs over a fixed period. bond premium for taxable bonds
employer reasonably believes that no
employee uses the vehicle for any If you amortize property, the acquired before October 23, 1986, do
not report the deduction here. See the
CAUTION qualify for the section 179
personal purpose. ! part you amortize does not instructions for Schedule A (Form
Line 38 expense deduction or for depreciation. 1040), line 16.
A policy statement that prohibits For taxpayers (other than
personal use (except for commuting) is Attach any information the Code and corporations) claiming a deduction for
not available if the commuting employee regulations may require to make a valid amortization of bond premium for
is an officer, director, or 1% or more election. See the applicable Code taxable bonds acquired after October
owner. This policy must meet all of the section, regulations, and Pub. 535 for 22, 1986, but before January 1, 1988,
following conditions. more information. the deduction is treated as interest
• The employer owns or leases the expense and is subject to the
vehicle and provides it to one or more Line 42 investment interest limitations. Use
employees for use in the employer's Complete line 42 only for those costs Form 4952, Investment Interest
trade or business, and it is used in the you amortize for which the amortization Expense Deduction, to compute the
employer's trade or business. period begins during your tax year allowable deduction.
• For bona fide noncompensatory beginning in 2022. For taxable bonds acquired after
business reasons, the employer Column (a)—Description of costs. 1987, you can elect to amortize the
requires the employee to commute to Describe the costs you are amortizing. bond premium over the life of the bond.
and/or from work in the vehicle. You can amortize the following. In general, you amortize bond premium
• The employer establishes a written on a bond by offsetting the stated
policy under which the employee may Geological and geophysical interest allocable to a tax year with the
not use the vehicle for personal expenditures (section 167(h)). You bond premium allocable to that tax year
purposes, other than commuting or de must amortize geological and and report the net amount of stated
minimis personal use (for example, a geophysical expenses paid or incurred interest on your return. See section 171
stop for a personal errand between a in connection with the exploration or and Regulations sections 1.171-1
business delivery and the employee's development of oil and gas within the through 1.171-5 for more information.
home). United States ratably over a 24-month Individuals, also see Pub. 550,
• Except for de minimis use, the period, beginning on the midpoint of the Investment Income and Expenses. A
employer reasonably believes that the tax year in which the expenses were bond premium carryforward as of the
employee does not use the vehicle for paid or incurred. For a major integrated end of a taxpayer’s final accrual period
any personal purpose other than oil company (as defined in section is treated as a deduction. See
commuting. 167(h)(5)), the costs paid or incurred Regulations section 1.171-2(a)(4)(i)(C).
• The employer accounts for the after December 19, 2007, must be For an individual, do not report the
commuting use by including an amortized ratably over a 7-year period deduction here. See the instructions for
appropriate amount in the employee's (a 5-year period for costs paid or Schedule A (Form 1040), line 16.
gross income. incurred after May 17, 2006, and before
December 20, 2007). Research and experimental
Line 40 expenditures (section 174). You
An employer that provides more than Pollution control facilities must capitalize and amortize specified
five vehicles to its employees who are (section 169). You can elect to research and experimental costs paid or
not 5% owners or related persons need amortize the cost of a certified pollution incurred in tax years beginning in 2022
control facility over a 60-month period

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ratably over a 5-year period (a 15-year years. Amortization for these costs • Organizational costs for a partnership
period for specified research and should be reported on line 43. (section 709).
experimental expenditures attributable For information on making the For business startup and
to foreign research conducted outside election, see Regulations section organizational costs paid or incurred
the Unites States, Puerto Rico, or any 1.59-1. Also, see Pub. 535. after September 8, 2008, you can elect
possession of the Unites States) to deduct a limited amount of startup or
beginning with the mid-point of the tax Certain section 197 intangibles. organizational costs for the year that
year in which the expenditures were The following costs must be amortized your business begins. You are not
paid or incurred. This includes any over 15 years (180 months) starting with required to attach a statement to make
amounts paid or incurred in connection the later of (a) the month the intangibles this election. Once made, the election is
with the development of software which were acquired, or (b) the month the irrevocable. Any cost not deducted
are not otherwise excluded trade or business or activity engaged in currently must be amortized ratably over
expenditures under section 174 and for the production of income begins. a 180-month period. The amortization
Regulations section 1.174-2. For more • Goodwill. period starts with the month you begin
information, see section 174 and • Going concern value. business operations. See Regulations
chapter 8 of Pub. 535. • Workforce in place. sections 1.195-1, 1.248-1, and 1.709-1.
• Business books and records,
The cost of acquiring a lease operating systems, or any other For business startup and
(section 178). Amortize these costs information base. organizational costs paid or incurred
over the term of the lease. For more • A patent, copyright, formula, process, after October 22, 2004, and before
information, see Pub. 535. design, pattern, know-how, format, or September 9, 2008, you can elect to
Qualified forestation and similar item. deduct a limited amount of startup and
reforestation costs (section 194). • A customer-based intangible (for organizational costs for the year that
You can elect to deduct a limited example, composition of market or your business begins. If the election is
amount of qualifying reforestation costs market share). made, you must attach any statement
paid or incurred during the tax year for • A supplier-based intangible. required by Regulations sections
each qualified timber property. You can • A license, permit, or other right 1.195-1(b), 1.248-1(c), and 1.709-1(c),
elect to amortize the qualifying costs granted by a governmental unit. as in effect before September 9, 2008.
that are not deducted currently over an • A covenant not to compete entered Any costs not deducted currently can be
84-month period. There is no limit on the into in connection with the acquisition of amortized ratably over a 180-month
amount of your amortization deduction a business. period, beginning with the month you
for reforestation costs paid or incurred • A franchise, trademark, or trade begin business.
during the tax year. name (including renewals).
Note. You can apply the provisions of
If you are otherwise required to file A longer period may apply to section Regulations sections 1.195-1, 1.248-1,
Form T (Timber), Forest Activities 197 intangibles leased under a lease and 1.709-1 to all expenses paid or
Schedule, you can make the election to agreement entered into after March 12, incurred after October 22, 2004,
amortize qualifying reforestation costs 2004, to a tax-exempt organization, provided the period of limitations on
by completing Part IV of the form. See governmental unit, or foreign person or assessment has not expired for the year
the Instructions for Form T (Timber) for entity (other than a partnership). See of the election. Otherwise, for business
more information. section 197(f)(10). startup and organizational costs paid or
See Pub. 535 for more information on A section 197 intangible is incurred after October 22, 2004, and
before September 9, 2008, the
Partnerships and S corporations, also CAUTION used in your trade or business.
amortizing reforestation costs. ! treated as depreciable property provisions under Regulations sections
see the instructions for line 44. When you dispose of a section 197 1.195-1(b), 1.248-1(c), and 1.709-1(c),
intangible, any gain on the disposition, as in effect before September 9, 2008,
Optional write-off of certain tax up to the amount of allowable will apply.
preferences over the period amortization, is recaptured as ordinary For business startup and
specified in section 59(e). You can income. If multiple section 197 organizational costs paid or incurred
elect to amortize certain tax preference intangibles are disposed of in a single before October 23, 2004, you can elect
items over an optional period. If you transaction or a series of related an amortization period of 60 months or
make this election, there is no AMT transactions, calculate the recapture as more.
adjustment for these expenditures. The if all of the section 197 intangibles were Attach any statements required by
applicable expenditures and the a single asset. This rule does not apply the appropriate section and related
optional recovery periods are as follows. to section 197 intangibles disposed of regulations to Form 4562 by the due
• Circulation expenditures (section for which the adjusted basis exceeds date, including extensions, of your
173)—3 years. the fair market value. return for the year in which the active
• Intangible drilling and development
costs (section 263(c))—60 months. For more details on section 197 trade or business begins. If you have
• Mining exploration and development intangibles, see Pub. 535. both startup and organizational costs,
costs (sections 616(a) and 617(a))—10 attach a separate statement for each
years. Startup and organizational costs. type of cost. If you timely filed your
• Research and experimental You can elect to amortize the following return without making the election, you
expenditures paid or incurred in tax costs for setting up your business. can still make the election on an
years beginning before January 1, 2022 • Business startup costs (section 195). amended return filed within 6 months of
(section 174(a) prior to amendment by • Organizational costs for a corporation the due date, excluding extensions, of
section 13206(a) of P.L. 115-97)—10 (section 248). the return. Enter “Filed pursuant to

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section 301.9100-2” on the amended the costs. For examples, see the Code which you elected to amortize over the
return. See Pub. 535 for more details. sections referenced in the instructions 10-year period under section 59(e) must
for line 42, column (a), earlier. be reported on line 43 of Form 4562.
Creative property costs. These Attach a statement that shows (a) a
are costs paid or incurred to acquire and Column (f)—Amortization for this
description of the costs; (b) the date
develop screenplays, scripts, story year. Compute the amortization
amortization began; (c) the amortizable
outlines, motion picture production deduction by:
amount; (d) the applicable code section;
rights to books and plays, and other 1. Dividing the amount in column (c) (e) the amortization period; (f) the
similar properties for purposes of by the number of months over which the accumulated amortization; and (g) the
potential future film development, costs are to be amortized and amortization amount for this year.
production, and exploitation. You may multiplying the result by the number of
be able to amortize creative property months in the amortization period Line 44
costs for properties not set for included in your tax year beginning in Report the total amortization, including
production within 3 years of the first 2022, or research and experimental
capitalized transaction. These costs are expenditures paid or incurred in 2022
2. Multiplying the amount in column
amortized ratably over a 15-year period and prior years and the allowable
(c) by the percentage in column (e).
under the rules of Rev. Proc. 2004-36, portion of forestation or reforestation
2004-24 I.R.B. 1063. Line 43 amortization, on the applicable “Other
Column (b)—Date amortization be- If you are reporting the amortization of Deductions” or “Other Expenses” line of
gins. Enter the date the amortization costs (other than research and your return. For more details, including
period begins under the applicable experimental expenditures) that began limitations that apply, see Pub. 535. For
Code section. The amortizable amount before your 2022 tax year and you are partnerships and S corporations, report
of a pollution control facility is reduced not required to file Form 4562 for any the amortizable basis of any forestation
by any special depreciation allowance other reason, do not file Form 4562. or reforestation expenses for which
included on line 14 for that facility. Report the amortization directly on the amortization is elected and the year in
“Other Deductions” or “Other Expenses” which the amortization begins as a
Column (c)—Amortizable amount. separately stated item on Schedules K
line of your return.
Enter the total amount you are and K-1 (Form 1065 or 1120-S). See the
amortizing. See the applicable Code Note. The amortization deduction and instructions for Schedule K (Form 1065
section for limits on the amortizable research and experimental or 1120-S) for more details on how to
amount. expenditures under former section report.
174(b) or the dollar amount of research
Column (d)—Code section. Enter the
and experimental expenditures for
Code section under which you amortize

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The time needed to complete and file this form will vary depending on individual circumstances. The estimated burden for
individual taxpayers filing this form is approved under OMB control number 1545-0074 and is included in the estimates shown
in the instructions for their individual income tax return. The estimated burden for all other taxpayers who file this form is shown
below.
Recordkeeping. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 hr., 44 min.
Learning about the law or the form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 hr., 16 min.
Preparing and sending the form to the IRS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 hr., 55 min.

If you have comments concerning the accuracy of these time estimates or suggestions for making this form simpler, we would
be happy to hear from you. See the instructions for the tax return with which this form is filed.

-16- Instructions for Form 4562 (2022)

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Table A—General Depreciation System
Method: 200% declining balance switching to straight line
Convention: Half-year
                                          If the recovery period is:
Ye r a              y   3 e s r a         y   5 e s r a                      y   7 e s r a          1 y   0 e s r a
1             33.33%                      20.00%                             14.29%                 10.00%
2             44.45%                      32.00%                             24.49%                 18.00%
3             14.81%                      19.20%                             17.49%                 14.40%
4             7.41%                       11.52%                             12.49%                 11.52%
5                                         11.52%                             8.93%                  9.22%
6                                         5.76%                              8.92%                  7.37%
7                                                                            8.93%                  6.55%
8                                                                            4.46%                  6.55%
9                                                                                                   6.56%
10                                                                                                  6.55%
11                                                                                                  3.28%

Table B—General Depreciation System
Method: 150% declining balance switching to straight line
Convention: Half-year
                                          If the recovery period is:
Year        5 years               7 years       10 years            12 years               15 years         20 years
1           15.00%                10.71%        7.50%               6.25%                  5.00%            3.750%
2           25.50%                19.13%        13.88%              11.72%                 9.50%            7.219%
3           17.85%                15.03%        11.79%              10.25%                 8.55%            6.677%
4           16.66%                12.25%        10.02%              8.97%                  7.70%            6.177%
5           16.66%                12.25%        8.74%               7.85%                  6.93%            5.713%
6           8.33%                 12.25%        8.74%               7.33%                  6.23%            5.285%
7                                 12.25%        8.74%               7.33%                  5.90%            4.888%
8                                 6.13%         8.74%               7.33%                  5.90%            4.522%
9                                               8.74%               7.33%                  5.91%            4.462%
10                                              8.74%               7.33%                  5.90%            4.461%
11                                              4.37%               7.32%                  5.91%            4.462%
12                                                                  7.33%                  5.90%            4.461%
13                                                                  3.66%                  5.91%            4.462%
14                                                                                         5.90%            4.461%
15                                                                                         5.91%            4.462%
16                                                                                         2.95%            4.461%
17                                                                                                          4.462%
18                                                                                                          4.461%
19                                                                                                          4.462%
20                                                                                                          4.461%
21                                                                                                          2.231%

                                                        -17-

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Table C—General Depreciation System
Method: Straight line
Convention: Mid-month
Recovery period: 27.5 years
                                                   The month in the 1st recovery year the property is placed in service:
Year                                1            2            3            4            5            6            7            8            9            10           11           12
1                                   3.485%       3.182%       2.879%       2.576%       2.273%       1.970%       1.667%       1.364%       1.061%       0.758%       0.455%       0.152%
2–9                                 3.636%       3.636%       3.636%       3.636%       3.636%       3.636%       3.636%       3.636%       3.636%       3.636%       3.636%       3.636%
10,12,14,16,18, 20, 22, 24, 26      3.637%       3.637%       3.637%       3.637%       3.637%       3.637%       3.636%       3.636%       3.636%       3.636%       3.636%       3.636%
11,13,15,17,19,  21, 23, 25, 27     3.636%       3.636%       3.636%       3.636%       3.636%       3.636%       3.637%       3.637%       3.637%       3.637%       3.637%       3.637%
28                                  1.97%        2.273%       2.576%       2.879%       3.182%       3.485%       3.636%       3.636%       3.636%       3.636%       3.636%       3.636%

Table D—General Depreciation System
Method: Straight line
Convention: Mid-month
Recovery period: 31.5 years
                                                   The month in the 1st recovery year the property is placed in service:
Year                                1            2            3            4            5            6            7            8            9            10           11           12
13,15,17,19, 21, 23, 25, 27, 29, 31 3.174%3.174% 3.175%3.175% 3.174%3.174% 3.175%3.175% 3.174%3.174% 3.175%3.175% 3.174%3.174% 3.175%3.175% 3.174%3.174% 3.175%3.175% 3.174%3.174% 3.175%3.175%
14,16,18, 20, 22, 24, 26, 28, 30    3.175%       3.174%       3.175%       3.174%       3.175%       3.174%       3.175%       3.174%       3.175%       3.174%       3.175%       3.174%
32                                  1.720%       1.984%       2.249%       2.513%       2.778%       3.042%       3.175%       3.174%       3.175%       3.174%       3.175%       3.174%

Table E—General Depreciation System
Method: Straight line
Convention: Mid-month
Recovery period: 39 years
                                                   The month in the 1st recovery year the property is placed in service:
Year                                1            2            3            4            5            6            7            8            9            10           11           12
1                                   2.461%       2.247%       2.033%       1.819%       1.605%       1.391%       1.177%       0.963%       0.749%       0.535%       0.321%       0.107%
2–39                                2.564%       2.564%       2.564%       2.564%       2.564%       2.564%       2.564%       2.564%       2.564%       2.564%       2.564%       2.564%
40                                  0.107%       0.321%       0.535%       0.749%       0.963%       1.177%       1.391%       1.605%       1.819%       2.033%       2.247%       2.461%

                                                                                        -18-

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                                                                    Depreciation                                                                         Deduction

                                                                                                                                                                                                        %
                                                                    Rate or                               Table

                                                                    Recovery                                                                                      Period

                                                                             Method/                                                                                                Convention

                                                                    Basis for
                                                                                                                                                                        Depreciation

                                                                                                                                                                                    Years
                                                                             Depreciation Prior

                                                            Special                                                                                                                                                  Basis
                                                Section 179                                    Allowance,                                                                                     and Other                   Reductions

                                                                                                                                                                                                         Use %
                                                                    Business/                                  Investment

Depreciation Worksheet (Keep for your records.)                     Cost or                                    Other                                                                                     Basis

                                                                    Date                                                                                                                                      Service
                                                                                                                         Placed in

                                                                                                                                  Description of Property

                                                                                                                                                                                                                                    -19-

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Index
 
                                Mid-quarter   9                 Classification of property 8  Section 179 expense 
A                                                               Conventions 9                 deduction    3 13, 
Alternative Depreciation      D                                 Depreciation deduction 9      Special depreciation 
  System:                     Definitions 1                     Determining the               allowance    6
  Basis for depreciation 10     Amortization  2                 classification  8            Recordkeeping  3
  Classification of             Commuting     2                 Placed in service date 8
  property    10                Depreciation  1                 Recovery period  9           S
  Conventions 10                Listed property 2                                            Section 179 expense 
  Depreciation deduction   10   Listed property -            I                                deduction   3
  Placed in service date 10     Exceptions      2            Involuntary conversion    7      Carryover of disallowed 
  Recovery period   10          Section 179 property  2                                       deduction    4
Alternative minimum tax    2  Depreciation:                  L                                Election 3
                                                                                              Limitations:
Amortization 14                 Accelerated Cost Recovery    Like-kind exchange     7         Maximum deduction           3
  Amortizable amount   16       System (ACRS)       6        Listed property:                 Sport utility vehicle 
  Amortization deduction   16   Assets placed in service in     Basis for depreciation 12     (SUV)        13
  Amortization of costs from    prior year    7
                                                                Convention 12
  prior year  16                General asset accounts  7                                     Taxable income             4
                                                                Cost or other basis 12
  Amortization of costs in      Income forecast method   6                                    Threshold cost of 
                                                                Depreciation deduction 12
  current year   14             Intangible property 6                                         property      3
                                                                Information on vehicle        Listed property 13
  Applicable code section  16   Listed property 11              use    13                     Recapture   3 13, 
  Certain bond premiums    14   Modified Accelerated Cost       Method 12                    Special depreciation 
  Cost of acquiring a           Recovery System 
  lease 15                      (MACRS)       7                 Passenger automobile          allowance   4
                                                                limits 12
  Creative property costs  16   Alternative Depreciation                                      Election out 6
  Date amortization             System        10                Definitions 12                Figuring the allowance      5
  begins    16                  General Depreciation            Exception   12                Listed property 11
  Description of costs 14       System        7                 Leasehold property            Qualified property         5
  Forestation and               Involuntary conversion     7    exception       12            Recapture   6
  reforestation costs    15     Like-kind exchange     7        Tables 13
  Geological and geophysical    Other 6                         Percentage of business or    U
                                                                investment use    11
  expenditures      14        Depreciation methods:                                          Uniform capitalization 
                                                                Placed in service date 11
  Optional section 59(e)        Declining balance 9                                           rules 11
                                                                Qualified business use 11
  write-off  15                 Straight line 9                                              Unit-of-production 
                                                                Questions for employers on 
  Pollution control           Depreciation tables   17 18,      vehicle use   13              method   6
  facilities 14               Depreciation Worksheet    19      Recapture of section 179 
  Research and experimental                                                                  W
  expenditures      14                                          expense deduction      13
  Section 197 intangibles  15 E                                 Recovery period  12          Where to find additional 
  Start-up and organizational Election out:                     Section 179 expense           information  1
  costs 15                      Involuntary conversion 7        deduction   13               Who must file 1
                                Like-kind exchange  7           Special depreciation 
C                               Special depreciation            allowance   11
Conventions:                    allowance     6                 Type of property 11

  Half-year 9                                                R
  Mid-month  9                G
                              General Depreciation           Recapture:
                                System:                         Listed property 11 13, 
                                Basis for depreciation 8        MACRS depreciation    10

                                                            -20-

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