Companies have the chance to deduct a bigger portion of the price of sure property and gear purchases within the 12 months they’re positioned in service by bonus depreciation. For property positioned in service after September 27, 2017, and earlier than January 1, 2023, the bonus depreciation fee is 100%. Because of this companies can deduct the total price of qualifying property within the 12 months it’s positioned in service, moderately than depreciating it over a number of years.
The bonus depreciation provision was enacted as a part of the Tax Cuts and Jobs Act of 2017. The availability was meant to encourage companies to put money into new gear and property, thereby stimulating financial progress. The availability has been prolonged a number of occasions since its authentic enactment, and is presently scheduled to run out on December 31, 2022. Nevertheless, there’s a risk that the availability may very well be prolonged once more earlier than it expires.
