Q. I put a deposit on a building in August of 2011 thinking that it would completed by the end of the year. The builder has not started the building yet and says it will most likely be completed mid February, depending on the weather. I paid for it in 2011 thinking I can write the building off. Now in reading your blog I understand that I can’t write it off in 2011?
A. In order for a farmer to construct a new farm building in 2011 and be able to take 100% bonus depreciation on the building your must meet two tests. First, you must have paid for, or have a financial obligation to pay for and secondly it must be available to place in service. In your case you meet test one but not test two so you do not qualify for the deduction in 2011.
In your case, since the construction was not finished by year-end, then 50% bonus depreciation will apply in 2012, not the 100% bonus depreciation of 2011.
Sorry.
A. In order for a farmer to construct a new farm building in 2011 and be able to take 100% bonus depreciation on the building your must meet two tests. First, you must have paid for, or have a financial obligation to pay for and secondly it must be available to place in service. In your case you meet test one but not test two so you do not qualify for the deduction in 2011.
In your case, since the construction was not finished by year-end, then 50% bonus depreciation will apply in 2012, not the 100% bonus depreciation of 2011.
Sorry.
