Bonus Depreciation 2024 Equipment. Bonus depreciation is a tax incentive that allows businesses to immediately deduct a significant portion of the purchase price of eligible assets, such as machinery, instead of writing them off over their useful life. Section 179 allows businesses to deduct the full purchase price of qualifying equipment and software purchased or financed during the tax year, up to a certain limit.
For example, if you purchase a piece of machinery in december of 2023, but don’t install it or start using it until january of 2024, you would have to wait until you file your 2024 tax return to claim bonus depreciation on. You can then deduct 60% of the remaining $200,000 ($500,000 − $300,000),.