Bonus Depreciation
Category: Deductions · Related form: Form 4562
An additional first-year depreciation allowance on qualifying property. The allowable percentage depends on the year the asset is placed in service and current law.
How Bonus Depreciation fits 2026 planning
Bonus Depreciation sits inside deduction planning — standard vs itemized choices, above-the-line adjustments, and Schedule A limits. For tax year 2026, US Tax Tools treats year-scoped constants (brackets, contribution limits, wage bases, credit schedules) as separate datasets — so explanations of Bonus Depreciation should be read with the same year selected in any linked calculator.
Category focus: Deductions. Readers usually land on this page while comparing a paycheck estimate, a credit phaseout, or a retirement contribution room figure that depends on understanding Bonus Depreciation first.
Worked example
When bonus depreciation is available at a high percentage, a business may write off most of a new asset’s cost in year one after applying Section 179 ordering rules.
Treat the example as a teaching sketch, not a filing position. Change filing status, state residency, or mid-year events and the same definition of Bonus Depreciation can produce a different cash outcome even when the glossary text stays the same.
What to watch for
Definitions of Bonus Depreciation can differ slightly across IRS publications, SSA rules, Marketplace subsidy worksheets, and state agencies. When two programs both say “income,” confirm which modification rules apply — MAGI for one credit is not always MAGI for another.
Legislation and inflation adjustments can move the dollar thresholds around Bonus Depreciation without renaming the concept. Prefer the effective date on the primary source (Rev. Proc., SSA notice, USDA table, or state DOR bulletin) over any blog summary — including this one if a later notice supersedes it.
On a filed return, Bonus Depreciation most often surfaces around Form 4562. Read the official IRS instructions for that form for the tax year you are filing — glossary pages summarize concepts; they do not replace line-by-line worksheets.
Next step
When you are ready to model numbers, open the Bonus Depreciation related calculator on US Tax Tools. Engines keep tax-year datasets separate so a 2025 habit does not silently reuse a 2026 constant.
Related reading: Tax insights for longer 2026 explainers, Methodology for how engines store cents and traces, and Disclaimer for educational-use limits.