Under Code Section 168(k), taxpayers can claim a special additional first-year depreciation allowance (also referred to as “Bonus Depreciation“) to recover part of the cost of certain qualified property placed in service during the tax year.
No election is necessary to take the bonus depreciation for “Qualified Property.” Taxpayers can elect out of the bonus depreciation rules, however. An election is necessary if a taxpayer wants to deduct bonus depreciation for specified plants.
The allowance applies only for the first year the taxpayer places the property in service. The allowance is an additional deduction the taxpayer can take after any Code Section 179 Deduction and before calculating regular depreciation under MACRS for the year the taxpayer places the property in service.
The Bonus Depreciation Rules were initially meant to cover a limited number of years. However, the rules have been extended and modified numerous times.
Please contact the office of Don Fitch Accountancy at (760)567-3110 or Email Don.Fitch@CPA.com if you have any questions or would like additional information.
DON FITCH, CPA
74478 Highway 111 #3
Palm Desert, CA 92260
Toll Free: (877)CPA-Help or (877)272-4357
P.S. My firm is based upon referrals. Please feel free to refer my firm to anyone you know that is looking for a new CPA and/or tax preparer. Thank you in advance.
(Updated 03/07/2021 03:22)