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Depreciation

Allocate section 179 expenses to a partner who is an estate or trust

Section 179 is expense not allocated to a partner who's an estate or trust.
The instructions for Form 4797 state: Partnerships and S corporations don’t report these transactions [dispositions by a partnership of section 179 property] on Forms 4797, 4684, 6252, or 8824. Instead, they provide their partners and shareholders the information they need to report the transactions. See the instructions for Form 1065 or Form 1120-S for details on the information that needs to be reported on Schedule K-1.
The instructions for Form 1065, Page 1, line 6 state: Partnerships should not use Form 4797 to report the sale or other disposition of property if a section 179 expense deduction was previously passed through to any of its partners for that property. Instead, report it in box 20 of Schedule K-1 using code L. See the instructions for
Dispositions of property with section 179 deductions (code L)
, later, for details.

This article applies to:

  • PRODUCT: UltraTax CS
  • Return type: 1065 Partnership
  • Subject: Depreciation

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