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Publication 946

How To  


• Section 179 Deduction 
• Special Depreciation  
• Listed Property

What's New(p2)


Increased section 179 deduction dollar limits.(p2)

The maximum amount you can elect to deduct for most section 179 property you placed in service in 2010 is $500,000 ($535,000 for qualified enterprise zone property). This limit is reduced by the amount by which the cost of the property placed in service during the tax year exceeds $2,000,000. See Dollar Limits under How Much Can You Deduct in chapter 2.

Certain property eliminated from definition of listed property.(p2)

For tax years beginning after 2009, cellular telephones and similar telecommunications equipment have been removed from the definition of listed property.

Depreciation limits on business vehicles.(p2)

The total section 179 deduction and depreciation you can deduct for a passenger automobile (that is not a truck or van) you use in your business and first placed in service in 2010 is $3,060, if the special depreciation allowance does not apply. The maximum deduction you can take for a truck or van you use in your business and first placed in service in 2010 is $3,160, if the special depreciation allowance does not apply. See Maximum Depreciation Deduction in chapter 5.

Election to accelerate certain credits in lieu of the special depreciation allowance.(p2)

The election to accelerate research and minimum tax credits in lieu of the special depreciation allowance applies only to certain property placed in service before January 1, 2011. For fiscal years ending after December 31, 2010, only minimum tax credits can be elected to be accelerated in lieu of the special depreciation allowance for round 2 extension property. See Election to Accelerate Certain Credits in Lieu of the Special Depreciation Allowance in chapter 3.
For the latest information on depreciation, see



Photographs of missing children.(p2)

The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.


This publication explains how you can recover the cost of business or income-producing property through deductions for depreciation (for example, the special depreciation allowance and deductions under the Modified Accelerated Cost Recovery System (MACRS)). It also explains how you can elect to take a section 179 deduction, instead of depreciation deductions, for certain property, and the additional rules for listed property.
The depreciation methods discussed in this publication generally do not apply to property placed in service before 1987. For more information, see Publication 534, Depreciating Property Placed in Service Before 1987.


Many of the terms used in this publication are defined in the Glossary near the end of the publication. Glossary terms used in each discussion under the major headings are listed before the beginning of each discussion throughout the publication.

Do you need a different publication?(p2)

The following table shows where you can get more detailed information when depreciating certain types of property.
For information
on depreciating:
See Publication:
A car463, Travel, Entertainment, Gift, and Car Expenses
Residential rental property527, Residential Rental Property (Including Rental of Vacation Home)
Office space in your home587, Business Use of Your Home (Including Use by Daycare Providers)
Farm property225, Farmer's Tax Guide

Comments and suggestions.(p2)

We welcome your comments about this publication and your suggestions for future editions.
You can write to us at the following address:

Internal Revenue Service 
Business Forms and Publications Branch 
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Although we cannot respond individually to each comment received, we do appreciate your feedback and will consider your comments as we revise our tax products.
Ordering forms and publications.(p3)
Visit to download forms and publications, call 1-800-829-3676, or write to the address below and receive a response within 10 days after your request is received.

Internal Revenue Service 
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Tax questions.(p3)
If you have a tax question, check the information available on or call 1-800-829-1040. We cannot answer tax questions sent to either of the above addresses.