The dam is only deductible if you can show it is a part of the production process on the farm....... as is the tiling..........and the fencing. If you have livestock on that farm, then the dam might be able to be deducted as a part of the system to provide water to the livestock........or maybe if you are irrigating out of a pond that the dam creates. But........tiling, dams, fencing are all land improvements, that must be added to cost of land.......UNLESS such are an "....integral part of the production process".... ....and then such are deemed to be section 1245 property, which in turn makes them eligible for Section 179 (and section 168(k) bonus depr if new items). If, for example, the land were purchased to put into CRP........then you would be hard put to sustain 179 in an audit. | 
Depreciating existing tile on new farm
