How would a taxpayer elect out of applying bonus depreciation to apply straight-line depreciation on their tax return? What is the process?

To elect out of bonus depreciation and apply straight-line depreciation instead, a taxpayer must follow a specific process outlined by the IRS. Here’s how you can do it: 1. **Identify the Property**: First, determine which property you want to elect out of bonus depreciation. This typically applies to qualified property such as machinery, equipment, or other tangible assets. 2. **Use Form 4562**: You will need to use IRS Form 4562, "Depreciation and Amortization," to make this election. This form is used to report depreciation deductions for property placed in service during the tax year. 3. **Attach a Statement**: Attach a statement to your tax return for the year the property is placed in service. This statement should clearly indicate that you are electing out of bonus depreciation for each class of property. The statement must include: - A description of the property. - The class of property (e.g., 5-year, 7-year property). - A declaration that you are electing out of the additional first-year depreciation deduction for that class of property. 4. **File Timely**: Ensure that you file your tax return, including Form 4562 and the attached statement, by the due date (including extensions) for the tax return for the year the property is placed in service. 5. **Irrevocable Election**: Be aware that this election is irrevocable. Once you elect out of bonus depreciation for a

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