Eligibility depends on the asset, acquisition rules, service date and any elections. Used property can qualify, but related-party and prior-use restrictions matter. A payment or delivery alone does not establish that an asset is ready and available for its business use.
Apply Section 179 first when elected, then bonus depreciation to remaining eligible basis and regular depreciation after that. State treatment can differ. Accelerating a deduction changes timing and may create later recapture when property is sold or business use changes.
An example
Hypothetical: an eligible $50,000 machine acquired and placed in service in 2026, used entirely for business with no election out, may receive $50,000 of federal bonus depreciation. The business still paid or financed the machine.
Reviewed October 7, 2026. IRS reference ↗
This is a general reference. Discuss how the rules apply to your business with your tax professional.