The IRS has recently issued changes that affect your 2001 income tax return.  A special 30% first-year depreciation has been passed through Congress.  This means that 30% of an asset's cost can be written off up front in the year placed in use, with the remaining 70% recovered under the regular depreciation schedules.  This new tax break is limited to NEW assets...for those whose original use starts with the taxpayer.  The extra write-off can be used on assets that have been partially expensed.  Any cost not expensed is eligible for the 30%, plus regular depreciation.  To qualify for this bonus, assets must be placed in service after September 10, 2001 and before September 11, 2004. In an unexpected move, Congress decided to amend the tax rules for 2001 during the filing season.  Therefore, if you want to take advantage of this bonus for 2001, you may need to file an amended return.



Source: Kiplinger Tax Letter
        March 15, 2002