Updated October 18, 2026. Quick answer: Lines 33 to 35 are Part IV, which figures the amount you add back when business use of a property drops to 50% or less. Line 33 is the prior deduction, line 34 is the depreciation that would have been allowable, and line 35 is line 33 minus line 34. Column (a) is for section 179 property and column (b) is for listed property under section 280F(b)(2).
What Part IV is for
The part is captioned “Recapture Amounts Under Sections 179 and 280F(b)(2) When Business Use Drops to 50% or Less”. Column (a) is for section 179 property. The instructions say “If you took a section 179 expense deduction for property placed in service after 1986 (other than listed property, as defined in section 280F(d)(4)) and the business use of the property decreased to 50% or less this year, complete column (a) of lines 33 through 35 to figure the recapture amount.” Column (b) is for listed property: “If you have listed property that you placed in service in a prior year and the business use decreased to 50% or less this year, figure the amount to be recaptured under section 280F(b)(2).” The instructions add “Complete column (b), lines 33 through 35.” The deduction itself is explained on the Form 4562 page.
Line 33: the earlier deduction
The caption is “Section 179 expense deduction or depreciation allowable in prior years”. The instructions say “In column (a), enter the section 179 expense deduction you claimed when the property was placed in service.” For the other column: “In column (b), enter the depreciation allowable on the property in prior tax years (plus any section 179 expense deduction you claimed when the property was placed in service).” Partners will see the section 179 amount on the Schedule K-1 box 12 page.
Line 34: recomputed depreciation
The caption is “Recomputed depreciation.” The instructions for column (a) say “In column (a), enter the depreciation that would have been allowable on the section 179 property from the year the property was placed in service through (and including) the current year.” For column (b): “In column (b), enter the depreciation that would have been allowable if the property had not been used more than 50% in a qualified business.” “Figure the depreciation from the year it was placed in service up to (but not including) the current year.” The instructions point to publications for the arithmetic, and the depreciation tables are in those publications, not on this page.
Line 35: the recapture amount
The caption is “Recapture amount. Subtract line 34 from line 33.”. The instructions say “Subtract line 34 from line 33 and enter the recapture amount as” other income “on the same form or schedule on which you took the deduction.” An example follows: “For example, if you took the deduction on Schedule C (Form 1040), report the recapture amount as other income on Schedule C (Form 1040).” The Schedule C side is described on the Schedule C page.
There is a self-employment tax note: “If you filed Schedule C or F (Form 1040) and the property was used in both your trade or business and for the production of income, the portion of the recapture amount attributable to your trade or business is subject to self-employment tax.” “Allocate the amount on line 35 to the appropriate schedules.” The basis rule is “Be sure to increase your basis in the property by the recapture amount.”
A short illustration of the form’s arithmetic (computed illustration, not an IRS example): if line 33 were $20,000 and line 34 were $12,000, then line 35 would be computed as $20,000 minus $12,000, which is $8,000.
Where the number comes from
Line 33 comes from the return on which you took the deduction when the property was placed in service. Line 34 comes from a recomputation using the depreciation rules, and line 35 is the difference. For a vehicle you will often also need the vehicle information; the Schedule C vehicle information page covers that side.
Where it goes next
Line 35 is not carried to another line of Form 4797. The form says “Recapture amount. Subtract line 34 from line 33. See the instructions for where to report”, and the instructions put it on the same form or schedule as the deduction, as quoted above. When more than one property is involved, the instructions say “If you have more than one property subject to the recapture rules, figure the recapture amounts separately for each property.” “Show these calculations on a separate statement and attach it to your tax return.” The Part III lines before this one are on the lines 25 to 32 page.
Edition and line numbers
This page reads the 2025 Form 4797, Sales of Business Property, 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 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. The whole form is walked through on the Form 4797 line by line guide page.
Common mistakes
- Combining several properties on one set of lines. The instructions say “figure the recapture amounts separately for each property.”
- Forgetting the basis step. The instructions say “Be sure to increase your basis in the property by the recapture amount.”
- Reporting the recapture on an unrelated schedule. The instructions say to enter it “on the same form or schedule on which you took the deduction.”
Related: Form 4562, Schedule C, Schedule K-1 box 12, and Schedule C vehicle information.
Sources
- Instructions for Form 4797, Sales of Business Property (2025): https://www.irs.gov/pub/irs-pdf/i4797.pdf
- Form 4797, Sales of Business Property (2025): https://www.irs.gov/pub/irs-pdf/f4797.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.