Partial Asset Disposition
A Partial Asset Disposition is something that can be done when a taxpayer disposes of a depreciable asset before it is finished being depreciated.
It allows the taxpayer to deduct the remaining basis of the disposed asset in the current year, instead of continuing to depreciate it over multiple years.
Starts at $100¹ with scaling discounts for multiple assets.
Example Scenario:
A rental property has a roof that originally cost $10,000 that has a remaining basis of $5,000. The roof is torn off and fully replaced in the current year. Instead of continuing to depreciate the old roof over a decade or more, the owner can report a Partial Asset Disposition to deduct the remaining $5,000 immediately. The new roof will also begin to be depreciated as normal. This creates a large deduction in the current year to help the owner combat the cost of replacing the roof.
Note: if the cost basis of the disposed asset (like a roof) is unknown to the taxpayer, a Partial Asset Disposition may still be possible via a Cost Segregation Study or the reasonable allocation method.
¹ Price is in addition to tax preparation and is for an asset which: 1) is disposed of for no value in the current year, and 2) has its original depreciable basis known. Custom quote required.