Enter software assets

These steps apply only to software.

You can Amortize software assets, or set them to take 168(k) allowance.

Option one: 167 property: Depreciated Property

• • Property type P
  • Method: SB
    • SB gets the 168(k) allowance.
      • On the 4562: 168(k) Allowance appears in Part II Line 14 in the year of Acquisition
      • On the 4562: Calculated Depreciation will appear on in Part II Line 16
  • Estimated life: three years

Option two: 167 property: Depreciated Property with Section 179

• • Property type P
  • Method: SF or SB (SF + 168(k) Allowance)
    • SB gets the 168(k) Allowance
      • On the 4562: 168(k) Allowance appears in Part II Line 14 in the year of Acquisition
      • On the 4562: Calculated Depreciation if any will appear in Part II Line 16
    • SF gets no 168(k) allowance
      • On the 4562: Calculated Depreciation if any will appear in Part II Line 16 in the year of Acquisition
  • Estimated life: three years
  • Enter the Section 179/Bonus Amount
    • Section 179/Bonus Amounts appears under Part I of the 4562 in the year of Acquisition

Option three: 197 property: Amortized Property

• • Property type Z
  • Method: SL
  • Estimated life: three years
  • SL doesn’t get the Section 168(k) or Section 179
    • On the 4562: Amortized Property shows in Part VI Line 42 and 43.