allowableNon-cash
Section 179 and bonus depreciation
Accelerated first-year depreciation elections that distort reported net income.
Rule
Add back as part of depreciation. Document the underlying asset and consider ongoing capex needs.
Evidence lenders expect
- Form 4562 Part I
- Purchase invoices
Worked example
As reported
Section 179 $140,000
In the memo
Added back; CNC machine documented
The objection you will hear
None when documented; lenders may impose a capex reserve.
Package your next loan in 15 minutes instead of 3 weeks.
Upload a set of sample tax returns and generate a complete, lender-ready credit memo on your first day.