Business Deductions and Depreciation

Popular code sections on business expenses, cost recovery, research costs, and loss limits.

Key sections and concepts

Section 162

Trade or business expenses

Allows ordinary and necessary business expenses.

Section 163(j)

Business interest limitation

Limits the deduction for business interest expense.

Section 168(k)

Bonus depreciation

Allows additional first-year depreciation on qualified property.

Section 179

Expensing election

Lets businesses elect to expense qualifying property, subject to limits.

Sections 174 and 174A

Research and experimental costs

Sets the treatment of foreign and domestic research expenditures.

Section 41

Research credit

Provides a credit for increasing qualified research activities.

Section 197

Intangible amortization

Amortizes goodwill and other acquired intangibles over 15 years.

Section 199A

Qualified business income deduction

Allows eligible owners of pass-through businesses a deduction on qualified income.

Section 263A

Uniform capitalization

Requires certain costs to be capitalized into inventory or property.

Section 274

Meals and entertainment

Limits deductions for meals, entertainment, gifts, and travel.

Section 280A

Home office and vacation homes

Limits deductions for business use of a home and rental of a residence.

Section 280F

Luxury autos and listed property

Limits depreciation on passenger autos and certain listed property.

Section 451

Timing of income

Sets the general rule for when income is included.

Section 461(l)

Excess business loss

Limits excess business losses of noncorporate taxpayers.

Section 471

Inventories

Covers when and how inventories are required.

Popular search topics

• bonus depreciation rules
• Section 179 deduction
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• Form 8995
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• Form 8990
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• Form 6765
• Section 174 capitalization
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For general education only, not tax advice. Tax law changes often, so confirm current rules and amounts with primary sources.