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Fair Skills Equipment and Depreciation
The Fair Skills Equipment and Depreciation guide (FSG-IR-02, Version 10, October 28, 2026) is one page of nonbinding general education on a standard equipment illustration. It states that I.R.C. § 168(k) generally allows 100% additional first-year depreciation for qualifying property acquired and placed in service after January 19, 2025, if ownership, classification, acquisition, business-use, election, and other requirements are met, and that eligible acquired software may qualify. If the full $255,000 cost qualifies and no election out applies, the illustration allocates $252,450 of gross depreciation to the 99% Investor and $2,550 to Holdings. That amount reduces taxable income, not tax dollar for dollar, and operations plus current interest deductions determine the Series result before owner-level limits.
The guide says purchase, financing, allocation, and rights records must support the actual property, and that an invoice alone does not establish tax treatment. Services, franchise rights, goodwill, and other intangibles may be amortized rather than expensed, and the separate $5,000 fee and $1,000 cash reserve are excluded from the equipment illustration. The identified device must be ready and available for its assigned use, with installation, software access, and permissions in place. Signature or payment alone does not establish readiness, and first revenue is not always controlling. A qualifying § 1060 acquisition requires residual allocation and Form 8594. It cites §§ 167(f), 168(k), 197, and 1060, Notice 2026-11, Publication 946, and the Form 8594 instructions, and it assures no deduction, refund, savings, or penalty protection.
