2019 Bonus Depreciation Percentage
The 2019 Bonus Depreciation Percentage is 100%.
Effective 2019-01-01Source: 2019 Instructions for Form 4562 (IRS)Verified 2026-08-29
Compared with 2018
Every figure on this page is unchanged from 2018.
| Item | 2018 | 2019 | Change |
|---|---|---|---|
| Special depreciation allowance | 100% | 100% | +0% (+0.0%) |
Who it applies to
Taxpayers who placed qualified property in service during the 2019 tax year
What changed this year, and why
The special depreciation allowance for qualified property placed in service during the tax year is 100%. This rate is unchanged from the prior year, when it was also 100%.
Common questions
- How is the special depreciation allowance calculated?
- The special depreciation allowance is 100% of the depreciable basis of qualified property placed in service during the tax year. The allowance is taken after any section 179 expense deduction but before regular MACRS depreciation, and it applies only in the first year the property is placed in service.
Every amount on this page is a published figure rather than yours. The First-year bonus depreciation on an asset takes the number you enter and works it out against them, showing which published figure it used.
What the percentage is applied to, and what is left afterwards
When you claim the 100% special depreciation allowance on qualified property, the allowance is figured first, before regular depreciation. After you figure your special depreciation allowance for your qualified property, you can use the remaining cost to figure your regular MACRS depreciation deduction. Therefore, you must reduce the depreciable basis of the property by the special depreciation allowance before figuring your regular MACRS depreciation deduction. At 100%, the entire cost of the property is recovered through the allowance in the first year, and there is no remaining depreciable basis left for regular MACRS depreciation in subsequent years. In earlier years when the percentage was lower, a portion of the cost would remain in the depreciable basis after the allowance and would then be depreciated under the regular MACRS system over the property's recovery period. This ordering rule prevents double-counting: the allowance reduces basis dollar for dollar, so the same cost is not deducted again through regular depreciation.
Depreciating the remaining cost. After you figure your special depreciation allowance for your qualified property, you can use the remaining cost to figure your regular MACRS depreciation deduction (discussed in chapter 4). Therefore, you must reduce the depreciable basis of the property by the special depreciation allowance before fig- uring your regular MACRS depreciation deduction.
Publication 946 (2019), How To Depreciate Property (IRS)
Electing out, by class of property
Taxpayers may elect to opt out of the special depreciation allowance entirely for any class of property placed in service during the tax year. The election is made by class, meaning you can choose to claim the allowance for some classes of property while declining it for others. To make the election, you must attach a statement to your tax return indicating the election and specifying the class of property it applies to. Each person owning qualified property must make the election separately - for example, partnerships elect at the partnership level, and each member of a consolidated group elects through the common parent. The election must generally be made on a timely filed return (including extensions) for the year the property is placed in service. Once made, the election cannot be revoked without IRS consent, which requires a letter ruling.
You can elect, for any class of property, not to deduct any special depreciation allowances for all property in such class placed in service during the tax year. To make an election, attach a statement to your return indicating what election you are making and the class of property for which you are making the election.
Publication 946 (2019), How To Depreciate Property (IRS)
Recapture when you dispose of the property
If you previously claimed the special depreciation allowance on an asset and later sell or otherwise dispose of it, the tax code may require you to recapture some or all of the benefit. When you dispose of property for which you claimed a special depreciation allowance, any gain on the disposition is generally recaptured (included in income) as ordinary income up to the amount of the special depreciation allowance previously allowed or allowable. This means that even though the allowance reduced your taxable income in the year it was claimed, any profit realized when you dispose of the property is treated as ordinary income, not capital gain, to the extent of the allowance. The recapture rule applies regardless of how long you held the property. For example, if you claimed a 100% special depreciation allowance on an asset in 2019 and later sold it at a gain, the entire allowance amount would be recaptured as ordinary income. This rule ensures that the accelerated deduction is matched by ordinary-income treatment on any corresponding gain when the property leaves your hands.
When you dispose of property for which you claimed a special depreciation allowance, any gain on the disposi- tion is generally recaptured (included in income) as ordi- nary income up to the amount of the special depreciation allowance previously allowed or allowable.
Publication 946 (2019), How To Depreciate Property (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
2019 Instructions for Form 4562 (IRS)
- Special depreciation allowance
is eligible for a special depreciation allowance of 100% of the depreciable basis of the property.