Ask A CPA - Depreciation

2018-Bonus Depreciation

100% additional first-year bonus depreciation is allowed for qualified property acquired and placed into service after September 27, 2017 and before January 1, 2023. The new rules eliminate the requirement that the original use of the property commence with the taxpayer. As such, bonus depreciation is available for new or used property. Taxpayers have a right to elect 50% bonus depreciation for property placed into service after September 27, 2017 during the first tax year that ends after September 27, 2017. In the years that follow the bonus depreciation percentage will diminish. i. For property placed into service after December 31, 2022 and before January 1, 2024 bonus depreciation is 80%. ii. For property placed into service after December 31, 2023 and before January 1, 2025 bonus depreciation is 60%. iii. For property placed into service after December 31, 2024 and before January 1, 2026 bonus depreciation is 40%. iv. For property placed into service after December 31, 2025 and before January 1, 2027 bonus depreciation is 20%.

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