First-Year Bonus Depreciation

 

The One Big Beautiful Bill Act (OBBBA) of 2025 made the 100% bonus permanent for qualifying assets placed in service 01/20/2025 and later.

For assets with a property type of P, A, T, and Q, the Tax book defaults the Depreciation Method to MA200 and the 168 Allowance % Field to 100% for assets placed in service on January 20, 2025 or later. MA200 is one of the plus 168 depreciation methods that allows you to take the additional first-year bonus depreciation.

For assets placed in service in 2025 between 01/01/2025 and 01/19/2025, the Tax Cuts and Jobs Act (TCJA ) 168 Allowance rates of 40% for qualified property and 60% for longer production period and certain aircraft apply.

Other information

• MA200 is not valid for personal property with a life over 10 years.

o Use MA150 for personal property with a life of 15 years.

o Use MA100 for personal property with a life of 25 years.

• The 168 Allowance is standard for qualifying assets, but taxpayers can elect out of the rules.

• Automobile and light truck bonus amounts may be limited by the luxury vehicle caps.

• Recycling and reuse property is eligible for 50% bonus depreciation. If your property qualifies, select 50% for the 168 Allowance.

• Qualified Improvement Property (QIP) is real property that qualifies for 100% bonus.