Arizona section 179 deduction adjustment for partnership

Forum|Forum|3 years ago
February 20, 2023
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On the 1065 federal form I took the full deduction allowed by section 179 for a laptop computer that I purchased in 2022. Then, while filing Arizona form 165 for my partnership, TurboTax is asking me about Section 179 adjustments. TurboTax displays a page titled "Section 179 Adjustment" and a text saying that there may be a section 179 adjustment (this page is displayed during the return review step). This page also displays a form titled "State Adjustments to Federal Depreciation Amounts". In this form there is a paragraph titled "Section 179 Adjustment" where all the entries (three columns, A, B, and C) are pre-filled with zeros.

Do I need to enter any values in these columns? Or, is there some other form that I need to update with the section 179 information from the federal form?

I searched the AZ form 165 for any mention of the section 179 deduction and I only found it in "Schedule K Equivalent Worksheet" at line 13 (IRC Section 179 Expense).

TurboTax Business Windows

Best answer by AliciaP1

No, since the Section 179 deduction is taken for assets placed in service after 12/31/16 you do not need to enter any values here. Section 179 deductions work similarly to bonus depreciation and AZ has add-back rules for bonus depreciation for assets placed in service before 12/31/16.