Form 4562: depreciation and Section 179

Equipment, computers and vehicles are capital purchases, deducted over time unless you elect to write them off sooner. Form 4562 is where those choices are made. This guide explains when you need it, the main choices, and the 2026 limits.

By Hamza Fida, Chartered Accountant. Reviewed by Muhammad Bilal, Chartered Accountant. Checked against official sources on . 3 minute read.

Short answer

Form 4562 reports depreciation, Section 179 expensing and amortization. File it for the first year you depreciate an asset, whenever you claim Section 179, and for vehicles and other listed property. For 2026, Section 179 allows up to $2,560,000 of qualifying purchases to be deducted at once, and 100% bonus depreciation, made permanent in 2025, can also apply.

At a glance

Section 179 limit, 2026
$2,560,000
Bonus depreciation
100%, permanent for property acquired after January 19, 2025
Required
First year of an asset, Section 179, listed property
Common MACRS lives
5 years computers and vehicles; 7 years furniture
Buildings
27.5 years residential, 39 years non-residential
Small items
De minimis safe harbor up to $2,500 instead
Form 4562: depreciation and Section 179Section 179 limit, 2026: $2,560,000; Bonus depreciation: 100%, permanent for property acquired after January 19, 2025; Required: First year of an asset, Section 179, listed property; Common MACRS lives: 5 years computers and vehicles; 7 years furniture; Buildings: 27.5 years residential, 39 years non-residential; Small items: De minimis safe harbor up to $2,500 instead.KEY FACTS AT A GLANCEForm 4562: depreciation and Section 179Section 179 limit, 2026$2,560,000Bonus depreciation100%, permanent forproperty acquired afterJanuary 19, 2025RequiredFirst year of an asset,Section 179, listedpropertyCommon MACRS lives5 years computers andvehicles; 7 yearsfurnitureBuildings27.5 years residential,39 years non-residentialSmall itemsDe minimis safe harbor upto $2,500 insteadChecked against official sourcesTax BakersForm 4562: depreciation and Section 179Section 179 limit, 2026: $2,560,000; Bonus depreciation: 100%, permanent for property acquired after January 19, 2025; Required: First year of an asset, Section 179, listed property; Common MACRS lives: 5 years computers and vehicles; 7 years furniture; Buildings: 27.5 years residential, 39 years non-residential; Small items: De minimis safe harbor up to $2,500 instead.KEY FACTS AT A GLANCEForm 4562: depreciation andSection 179Section 179 limit, 2026$2,560,000Bonus depreciation100%, permanent for property acquired afterJanuary 19, 2025RequiredFirst year of an asset, Section 179, listedpropertyCommon MACRS lives5 years computers and vehicles; 7 yearsfurnitureBuildings27.5 years residential, 39 yearsnon-residentialSmall itemsDe minimis safe harbor up to $2,500 insteadChecked against official sourcesTax Bakers
Key facts at a glance, as set out in this guide.

When do you need Form 4562?

  • Depreciation for property placed in service during the year.
  • Any Section 179 deduction, including carryovers.
  • Depreciation on vehicles and other listed property, whenever placed in service.
  • Amortization that begins during the year, such as start-up costs.
  • Any depreciation claimed by a corporation other than an S corporation.

A sole proprietor only continuing depreciation on older assets, with no listed property, generally does not need it that year.

What are the main choices?

MethodHow it worksLimits
Section 179Elect to expense qualifying property in the year placed in service$2,560,000 for 2026, reduced once purchases pass a threshold; limited to business income
Bonus depreciationDeduct 100% of qualifying property in the first yearNo dollar cap; can create a loss; elect out by class if preferred
Regular MACRSDeduct over the asset's class lifeFollows set tables and conventions

A plain-English comparison is in Section 179 vs bonus depreciation.

How is the form organized?

  1. Part I: Section 179

    Elected property, the limit and any carryover.

  2. Part II: bonus depreciation

    The special depreciation allowance.

  3. Part III: MACRS

    Regular depreciation by class and method.

  4. Part V: listed property

    Vehicles and other listed property, with business use percentages.

  5. Part VI: amortization

    Start-up costs and other amortizable items.

What does an example look like?

A consultant buys a $3,200 computer and $8,000 of office furniture in 2026. The computer is over the $2,500 de minimis limit, so it goes on Form 4562. With 100% bonus depreciation, both are deducted in full in 2026 in Part II. If the consultant preferred, Section 179 in Part I would give the same result but cannot create a loss, while regular MACRS in Part III would spread the computer over five years and the furniture over seven.

How are vehicles treated?

Vehicles are listed property and must be used more than 50% for business to qualify for Section 179 or bonus depreciation. Passenger vehicles have annual depreciation caps, while heavier vehicles over 6,000 pounds have a separate Section 179 limit. Keep a mileage log to prove business use. See mileage vs actual vehicle expenses.

What about small purchases?

Items under the de minimis safe harbor, up to $2,500 per item or invoice for most small businesses, can be expensed directly without depreciation, by election on the return. See how to categorize business expenses.

What happens when you sell or stop using an asset?

Selling equipment for more than its depreciated value brings back the earlier deductions as ordinary income, known as depreciation recapture, reported on Form 4797. If business use of Section 179 property falls to 50% or less in a later year, part of the Section 179 deduction is recaptured as income, and the same applies to listed property such as vehicles. Keep a record of each asset's cost, date placed in service, method and depreciation claimed.

What records support depreciation?

Purchase invoices, the date each asset was placed in service, business use percentages and mileage logs for vehicles, and a fixed asset register showing cost, method, life and accumulated depreciation. Keep them until three years after the year you dispose of the asset. See how long to keep business records.

Is writing everything off at once always best?

Not always. A large first-year deduction can waste lower tax brackets, and selling the asset later can bring the deduction back as taxable income. In a low-income year, regular depreciation can spread the benefit into years with higher rates. See year-end tax planning.

Bought equipment this year?

We choose the best mix of Section 179, bonus and regular depreciation for your situation, and complete Form 4562 with your return.

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Questions people ask

When do I need to file Form 4562?

For the first year you depreciate an asset, whenever you claim Section 179, for vehicles and other listed property, and for new amortization.

What is the Section 179 limit for 2026?

$2,560,000, reduced once total qualifying purchases pass a threshold, and limited to business income.

Is bonus depreciation 100%?

Yes. The 2025 tax law made 100% bonus depreciation permanent for qualifying property acquired after January 19, 2025.

Can I deduct a laptop without Form 4562?

If it costs $2,500 or less, you can expense it under the de minimis safe harbor election instead of depreciating it.

Sources

Every fee, date and rule on this page was taken from these official and primary sources.

  1. IRS: About Form 4562
  2. IRS Publication 946: How to Depreciate Property
  3. IRS: Tangible property final regulations, including the de minimis safe harbor

Rules and fees change. If you are reading this long after October 1, 2026, confirm the figures with the source before you rely on them.

Business tax by entity typeBusiness expenses you can deduct: a working listDeadlines, penalties and IRS noticesYear-end tax planning checklist for small businessesBusiness tax by entity typeVehicle deduction: standard mileage rate vs actual costs

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This guide is general information. It is not tax or legal advice for your situation.