Most tax savings are decided before December. This is one of them, and it turns on a date most people do not have written down.
100% bonus depreciation is permanent again for property acquired after 19 January 2025. The switch is the acquisition date, not the date the asset went into service. Property acquired on or before 19 January 2025 stays on the old phase-down schedule.
That distinction is the whole thing. Two businesses can put identical equipment into service in the same week of 2026 and get different answers, because one committed to the purchase before 19 January 2025 and the other after.
So the first question is not “when did we start using it”
It is: when did we acquire it? Which means finding the contract, the purchase order, or whatever document fixed the commitment. If a purchase straddles that date and nobody can produce the paperwork, the answer is not available — and that is a records problem you can still fix in October.
Then ask the state question separately
This is the part that gets skipped. Many states do not follow the federal rule at all.
New Jersey, for example, disallows bonus depreciation entirely and caps section 179 at $25,000, using a definition of the Internal Revenue Code frozen at 31 December 2002. So a single equipment purchase produces a federal answer and a state answer that can point in opposite directions, and only one of them is the one you read about online.
One purchase. Two answers. Both belong in the decision, and the state one is usually the surprise.
What to do before 31 December
- List everything acquired or committed to in 2025 and 2026, with the date of the commitment and the document that proves it.
- Split the list at 19 January 2025.
- Run the state treatment separately for every state you file in.
- Then decide what else to buy this year — because after 31 December, most of what is left is filing.
The wider picture — what else lost its expiry date this year — is in What Stopped Being Temporary.
Where this comes from
IRC section 168(k), as amended by Pub. L. 119-21. New Jersey has decoupled from section 168(k) since 2002; the section 179 limitation and the 2002 Code definition are reflected on CBT Schedule S Part I line 11 and the GIT-DEP worksheet.
This post is general information about federal and New Jersey tax rules as they stood on the reviewed date shown, not advice about your situation. Acquisition-date questions are fact-dependent and turn on documents. Check the date above before you rely on anything here, and talk to us about your own facts.