QIP HELD BY PARTNERSHIPS
The first roadblock was that refunds are generally not available for partnerships or their partners. The IRS has temporarily suspended this rule by allowing partnerships to file amended returns. It is critical that the instructions in IRS Revenue Procedure 2020-23 are followed; otherwise a partnership might increase the amount of tax that the partners must pay. These risks are discussed further in my Tax Notes article, "Partnership Administrative Adjustment Requests Are Dangerous," Tax Notes Today (April 14, 2020).
QIP HELD BY REAL PROPERTY TRADES OR BUSINESSES
The second roadblock was that bonus depreciation is generally not available for QIP when the taxpayer has made an election under Section 163(j) of the Tax Code to be treated as a "real property trade or business" (RPTB) and thereby avoid certain limitations on interest deductions. Once this election is made, it generally cannot be revoked. Therefore, taxpayers that made this election on their 2018 or 2019 return would ordinarily be unable to claim bonus depreciation for their QIP in those years.
IRS Revenue Procedure 2020-22 has removed this roadblock. Now, a taxpayer may revoke its RPTB election. Here, too, it is critical to comply with the rules laid out in that revenue procedure.