Built-in gain tax and section 179 assets

When an S Corporation disposes of an asset with Section 179, the assumption is made that the asset was purchased by the S Corporation, and the Section 179 was passed through to the shareholder. If the asset was purchased by the S Corporation, then the asset wouldn't be subject to built-in gain tax when it's sold.
If the asset was purchased when the corporation was a C Corporation, then the Section 179 should be removed from the asset. Once the Section 179 has been removed, the asset will be included in the built-in gain calculation.
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