I have a Sub S Corporation and bought a piece of equipment in 2006 that qualified for Section 179 expense, so I expensed 100% of the cost for that year. My tax software reported the amount on line 12 of the K-1 schedule titled "Sec 179 Expense".

I disposed of the equipment in 2007 and needed to record the recapture amount, however, I could not figure out how to record it using my tax software. Since the original amount was recorded on line 12 of the 2006 K-1, I forced a negative number in this line for my 2007 return which represented the recapture amount. I don't think this was correct and I'm hoping someone out there might help me out.

Where should this be shown on my corporate return? I think it has to be somewhere on my K-1 schedule so that it flows to my personal return, but I'm not sure where. Help!

Thanks in advance.

Paul M

Paul:

Since no one answered, I assume you called a CPA or enrolled agent and got the answer, which is the correct thing to do.

The complexity of this issue is the reason you got no answer.

Some tax questions are beyond the scope of expertise for this forum; this was one of those questions.