Bonus Depreciation

Bonus depreciation is a tax incentive that allows businesses to deduct more of the cost of certain new assets in the year they are purchased. This can help businesses save money on taxes and invest in new equipment or other assets.

The amount of bonus depreciation that businesses can claim depends on the type of asset and when it is purchased. For most assets, businesses can claim 100% of the cost in the year they are purchased. However, for some assets, the bonus depreciation rate is lower. For example, the bonus depreciation rate for passenger vehicles is 50%.

Bonus depreciation is available for both new and used assets. However, the used asset must be purchased after December 31, 2017, and before January 1, 2023.

Bonus depreciation is a temporary tax incentive that is scheduled to expire at the end of 2023. However, there is a possibility that it could be extended.

Bonus depreciation can be a valuable tax incentive for businesses. It can help businesses save money on taxes and invest in new equipment or other assets. However, businesses should be aware that bonus depreciation is a temporary tax incentive and that it could expire at the end of 2023.

Here are some additional details about bonus depreciation:

• Bonus depreciation is available for both tangible and intangible assets.
• Tangible assets are physical assets, such as equipment, machinery, and buildings.
• Intangible assets are non-physical assets, such as patents, copyrights, and trademarks.
• The bonus depreciation rate for tangible assets is 100%.
• The bonus depreciation rate for intangible assets is 50%.
• Bonus depreciation is available for both new and used assets.
• New assets are assets that have never been used before.
• Used assets are assets that have been used before.
• Bonus depreciation is available for assets that are purchased after December 31, 2017, and before January 1, 2023.
• Bonus depreciation is a temporary tax incentive that is scheduled to expire at the end of 2023.
• There is a possibility that bonus depreciation could be extended.

Businesses should consult with their tax advisor to determine if they are eligible for bonus depreciation and to calculate the amount of the deduction.