For a cash basis taxpayer a generator was purchased for a business and half of the expense was paid in 2021 and the remainder in 2022. The cost of the generator was $10,000. Is it proper to take the 179 deduction in year 2021 for $5000 and then depreciate the remaining $5000 payment in 2022 over 7 years? I was hoping that this generator maybe was put on a credit card in year 2021 and the credit card had been paid off with the two $5000 payments. This way I could just take the section 179 deduction for the entire $10k in year 2021.
USA Section 179 on Generator
- Thread starter LDAWN
- Start date
I also have a similar question but this time the asset wasn't actually installed until 2022, but half was paid in 2021 as a down payment. The section 179 deduction can't be taken until 2022 when the asset was put in service. Would the entire amount of the asset be included in the 179 deduction in 2022 even though the down payment was paid in 2021? This is a cash basis taxpayer. This asset was also for a generator but unlike my first question, wasn't installed until the year after the down payment was made.