From equipment and vehicles to rental property and building improvements, depreciation affects a wide range of assets encountered in tax preparation. Understanding when costs can be deducted immediately, when they must be capitalized, and how they are recovered over time is critical to preparing accurate returns.
2026 Depreciation Essentials provides a comprehensive examination of depreciation concepts and their practical application to business and rental property. The course covers depreciable property, placed-in-service rules, basis, MACRS, class lives, recovery periods, and depreciation conventions.
Participants will examine 100% bonus depreciation and Section 179, including the types of property that may qualify and the choices available when determining how quickly an asset's cost should be recovered. The course also addresses de minimis rules and the important distinction between repairs and improvements, including betterments, adaptations, and restorations.
Special attention is also given to vehicle depreciation and the rules that can affect business vehicles. The course concludes by examining the disposition of depreciated property and how prior depreciation can influence adjusted basis, taxable gain, and depreciation recapture.
With practical examples throughout, this course connects depreciation fundamentals with common business and property tax situations to provide a more complete understanding of an asset's tax treatment from acquisition through disposition.
Learning Objectives
Upon completion of this course, participants will be able to:
- Identify business and rental property that may be subject to depreciation.
- Determine when property is placed in service for depreciation purposes.
- Explain how basis and recovery periods affect depreciation deductions.
- Apply fundamental MACRS depreciation concepts.
- Recognize property that may qualify for bonus depreciation or Section 179.
- Distinguish between deductible repairs and capital improvements.
- Identify special depreciation considerations associated with business vehicles.
- Explain the effect of depreciation on the subsequent sale or disposition of business property.
This course counts for 2 Hours of Federal Tax Law for IRS Continuing Education.
About the presenter:
Jason Dinesen (EA, LPA) is a tax nerd, entrepreneur, tax expert, and a well-known presenter of continuing education courses.
Known for his sharp tax interpretations, he is one of the quickest to bring the analysis of the latest tax updates and IRS guidance to the professional community. Jason has coached over 200,000 accounting, tax, and HR professionals on various topics of accounting, individual taxation, corporate taxation, professional ethics, and much more.
He has presented dozens of webinars on Form 1099 (for 10 years on this subject!), marriage in the tax code, tax updates, the new Form W-4, payroll updates, filing status, tax credits, corporation and partnership taxation, and other issues relating to the modern-day setting.
Frequently Asked Questions
What types of property can be depreciated?
Depreciation can apply to assets used in a business or rental activity that meet the applicable requirements. Examples discussed in the course include equipment, computers, vehicles, and buildings. Land itself cannot be depreciated, although certain land improvements can qualify.
Does this course cover rental property depreciation?
Yes. Rental property issues appear throughout the course, including determining depreciation basis when personally used property is converted to rental use and distinguishing repairs from improvements.
What is the difference between a repair and an improvement for tax purposes?
Generally, qualifying repairs and maintenance may be currently deductible, while improvements must be capitalized. The course discusses the betterment, adaptation, and restoration concepts used to determine whether an expenditure is considered an improvement.
Does the course cover vehicle depreciation?
Yes. Vehicle depreciation is specifically addressed, including depreciation limitations and the significance of vehicle weight when applying certain depreciation rules.
What is the de minimis safe harbor?
The course explores the de minimis rules that may allow certain lower-cost property purchases to be expensed rather than capitalized. It also examines limitations and anti-abuse considerations surrounding the rule.
What happens to depreciation when business property is sold?
Previous depreciation reduces the adjusted basis of the property, which can increase the taxable gain when the property is sold. Depending on the circumstances, some or all of the gain attributable to prior depreciation may be subject to depreciation recapture.
