On a similar vein, I'm trying to understand if there's an inherent advantage in taking 179 or bonus? Obviously, 179 has income limits, but otherwise....does it matter?
1. Neither bonus depreciation nor Section 179 requires an alternative minimum tax adjustment.
2. Both apply to new or used assets
3. Bonus depreciation must be claimed or elected out of by class. Section 179 is elected on an asset by asset basis and can be used to expense less than the full amount of the asset’s basis.
4. Bonus depreciation is not limited by taxable income and can be used to create an NOL and perhaps used immediately.
5. The asset must be used over 50% of the time for business to qualify for Section 179. If the usage later falls below 50% business usage the Section 179 must be recaptured. Except in the case of listed property the 50% business usage is not a requirement for bonus depreciation.
6. State difference, e.g. CA does not conform to bonus depreciation and limits 179 to $25,000