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Depeciation Method for Land Improvements

Forum|Forum|4 years ago
March 11, 2022
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A DST that I invested in has elected to depreciate land improvements using 15 year, MC150AHY, derpreciation

method and is taking 100% deduction in the first year as reported on my year end statement. Am I requird to take 100% in the first year also or may I chose to take depreciation spread over the year year life? Since I only became an investor in October, 2021, taking the full depreciation in 2021 will create a large loss in the first year

and increase the recapture at the end of a 7 year term for this DST.

Best answer by ColeenD3

You are never required to take accelerated depreciation. You can opt out. You can choose the type of depreciation that works best for your situation.

In general, taxpayers may elect out of bonus depreciation for any qualifying property placed in service during the taxable year. The election applies to all property of the same property class that is placed in service by the taxpayer in the same year.

ColeenD3Answer

You are never required to take accelerated depreciation. You can opt out. You can choose the type of depreciation that works best for your situation.

In general, taxpayers may elect out of bonus depreciation for any qualifying property placed in service during the taxable year. The election applies to all property of the same property class that is placed in service by the taxpayer in the same year.