When you buy real property (or personal property that lasts more than one year) to use in your business, you may have up to three options for deducting the cost:

Regular depreciation

Bonus depreciation

IRC Section 179 expensing (technically, depreciation in advance)

Regular depreciation takes several years.

Bonus depreciation allows you, through 2022, to deduct 100 percent of the cost of personal property in one year.

IRC Section 179 expensing allows you to deduct up to $1,050,000 of the cost of personal property.

As we explain in this article, various rules govern what year your deduction begins—and if you use regular depreciation, what month it begins.

Rule 1: You Must Be in Business to Claim Depreciation

To claim depreciation, you must place the property in service in an active trade or business.1

If you purchase property with the intent of beginning a new business, no depreciation ... Log in to view full article.