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As of June 1, 2003, New York stopped conforming to federal bonus depreciation. Therefore, depreciation for any assets purchased on or after 6/1/03 that took bonus depreciation must be recalculated for New York without the bonus depreciation.

Form IT-398 calculates the depreciation adjustments for Form IT-205, Schedule B due to bonus depreciation. These adjustments consist of an addition for total federal depreciation and a subtraction for total allowable New York depreciation. The total federal depreciation is then presented on Form IT-225, Page 1 as an addition and the total allowable New York depreciation is presented on Form IT-225, Page 2 as a subtraction.

Related topic: 1041 New York frequently asked questions

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