Tax reform legislation passed in December 2017 included numerous changes that affect businesses this year. One of them allows businesses to write off most depreciable business assets in the year they place them in service. Here are five facts to help businesses better understand this deduction:
1. The 100-percent depreciation deduction generally applies to depreciable business assets with a recovery period of 20 years or less and certain other property.
2. Machinery, equipment, computers, appliances, and furniture generally qualify.
3. The 100-percent depreciation deduction applies to qualifying property acquired and placed in service after September 27, 2017.
4. Taxpayers who elect out of the 100-percent depreciation deduction for a class of property must do so on a timely filed return.
5. The IRS has issued proposed regulations with guidance on what property qualifies and rules for qualified film, television and live theatrical productions, and certain plants.
For more details about the 100-percent depreciation deduction or electing out of claiming it, please call.