How section 179 depreciation is handled in 1065 and 1120S returns. Section 179 allows businesses to deduct the full purchase price of qualifying equipment bought or financed during the tax year.This Drake Tax article discusses entries that are available for 179 expenses, limits, and worksheets. Section 179 is a tax code section that allows businesses to deduct the total cost of equipment they bought during the year from their taxable income. This item addresses how S corporations and partnerships that have a Sec. 179 recapture event should report the event to their owners.