A Look at the Bonus Depreciation Phase Out
Bonus depreciation allows business taxpayers to deduct additional depreciation for the cost of qualifying business property, beyond normal depreciation allowances – encouraging capital purchases. Since 2017 under the Tax Cuts and Jobs Act businesses have been benefiting from the provision, which has allowed 100% bonus depreciation. But its benefits began to phase out on December 31, 2022.
Going forward, although bonus depreciation is the first of the tax benefits being reduced or phased out, it is by no means the last. The laws are ever-evolving and taxpayers anticipate that C Corporation tax rates may go up and exemptions for gift and estate taxes will go down in the near future.
Phil Jelsma, a partner and chair of the tax practice team at Crosbie Gliner Schiffman Southard & Swanson LLP (CGS3), takes a look at the implications of phasing out the bonus depreciation tax benefit, examining what it could mean for business in The Daily Transcript. (Subscriber only).