Updated October 18, 2026. Quick answer: Lines 6 to 13 finish Part I. You list each item you elect to expense on line 6, add listed property on line 7, compare to the line 5 limit on line 9, add any carryover on line 10, apply the business income limit on line 11, and line 12 is the section 179 deduction. Line 13 carries any disallowed part to the next year.
Related reading on this site: IRS Publication 946.
S corporation return (Form 1120-S) for 2025, read line by line: Form 1120-S Schedule K lines 11 to 13.
What lines 6 to 13 ask for
The captions are “Description of property”, “Cost (business use only)” and “Elected cost” for line 6, then “Listed property. Enter the amount from line 29” for line 7, “Total elected cost of section 179 property. Add amounts in column (c), lines 6 and 7” for line 8, and “Tentative deduction. Enter the smaller of line 5 or line 8” for line 9. The earlier lines are at lines 1 to 5, and this page is part of the Form 4562 walk-through.
Line 6: each item you elect to expense
The instructions say “Do not include any listed property on line 6.” “Enter the elected section 179 cost of listed property in column (i) of line 26.” For column (a) the instruction is “Enter a brief description of the property you elect to expense”. For column (c) it is “Enter the amount you elect to expense.” It adds “You can depreciate the amount you do not expense.” Partners and shareholders have a special entry: “To report your share of a section 179 expense deduction from a partnership or an S corporation, enter “from Schedule K-1 (Form 1065)” or “from Schedule K-1 (Form 1120-S)” across columns (a) and (b).” The Schedule K-1 side is covered at Schedule K-1 box 12.
Lines 7 to 9: listed property, total and tentative deduction
Line 7 is a carry-over from Part V: “Enter the amount that you elected to expense for listed property (defined earlier) on line 29 here.” The instructions have no separate paragraph for lines 8 and 9, so the captions above are the guide. Line 9 takes the smaller of line 5 and line 8. Listed property is covered at Part V.
Line 10: carryover from last year
The instructions define it this way: “The carryover of disallowed deduction from 2024 is the amount of section 179 property, if any, you elected to expense in previous years that was not allowed as a deduction because of the business income limitation.” “If you filed Form 4562 for 2024, enter the amount from line 13 of your 2024 Form 4562.”
Line 11: the business income limit
The instructions say “The total cost you can deduct is limited to your taxable income from the active conduct of a trade or business during the year.” “You are considered to actively conduct a trade or business only if you meaningfully participate in its management or operations.” For individuals the entry is “Enter the smaller of line 5 or the total taxable income from any trade or business you actively conducted, computed without regard to any section 179 expense deduction, the deduction for one-half of self-employment taxes under section 164(f), or any net operating loss deduction.” The instructions then name separate rules for partnerships, S corporations and other corporations, so use the paragraph for your type of filer.
Line 12: the section 179 expense deduction
The caption is “Section 179 expense deduction. Add lines 9 and 10, but don’t enter more than line 11”. For people with more than one business the instructions say “The limitations on lines 5 and 11 apply to the taxpayer, and not to each separate business or activity.” They also say “if you have more than one business or activity, you may allocate your allowable section 179 expense deduction among them.” The instructions give the method: enter “Summary” at the top of Part I of one separate Form 4562, and on line 12 of each business’s Form 4562 enter the amount allocated to it.
Line 13: carryover to the next year
The instructions have no separate paragraph for line 13, so the caption is the guide: “Carryover of disallowed deduction to 2026. Add lines 9 and 10, less line 12”. A computed illustration, not an IRS example: if line 9 were $80,000 and line 10 were $20,000, lines 9 and 10 together would be $100,000. If line 11 were $60,000, line 12 would be $60,000 and line 13 would be $100,000 minus $60,000, a computed result of $40,000.
Where the number comes from
Line 6 comes from your asset purchase records, line 7 from Part V line 29, line 10 from last year’s Form 4562 line 13, and line 11 from your taxable income from the business. The deduction is the result of lines 9 to 11.
Where it goes next
The line 12 amount is added into the Part IV total. Line 22 says “Add amounts from line 12, lines 14 through 17, lines 19 and 20 in column (g), and line 21.” That summary is explained at lines 21 to 23. The instructions also warn “If you elect to expense section 179 property, you must reduce the amount on which you figure your depreciation or amortization deduction (including any special depreciation allowance) by the section 179 expense deduction.”
Edition and line numbers
This page reads the 2025 Form 4562, Depreciation and Amortization, and its 2025 instructions, the current files irs.gov served on 2026-10-18. They are the files for the tax year 2025 return, filed in 2026. The form’s own header says “Attach to your tax return.” Check the tax year printed on the form you are filling in and use the line numbers on that year’s form, because a different year’s form can number or word its lines differently.
Common mistakes
- Putting listed property on line 6. The instructions say “Do not include any listed property on line 6.”
- Forgetting the business income cap. The instructions say “The total cost you can deduct is limited to your taxable income from the active conduct of a trade or business during the year.”
- Treating a mere investor’s income as business income. The instructions say “A mere passive investor is not considered to actively conduct a trade or business.”
Related: Form 4562, Schedule K-1 box 12, Schedule C lines 12 and 13, and Schedule 1 lines 8a and 8b.
Sources
- Instructions for Form 4562, Depreciation and Amortization (2025): https://www.irs.gov/pub/irs-pdf/i4562.pdf
- Form 4562, Depreciation and Amortization (2025): https://www.irs.gov/pub/irs-pdf/f4562.pdf
Read from the IRS documents linked above on October 18, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the account provider or the IRS is the right place to confirm anything consequential.