Bonus Depreciation is true statement?

Bonus Depreciation is true statement?

• A. Aimed to help small business and allows deduction only for used equipment.
• B. Only available on new equipment.
• C. Provides beneficial depreciation acceleration for lessors.
• D. Created by Job Creation and Worker Assistance Act of 2002.

Answer: (D)

Bonus depreciation accelerates tax relief by letting you deduct a large portion of the cost of qualifying property in the first year, in addition to regular depreciation. The true statement is that bonus depreciation was created by the Job Creation and Worker Assistance Act of 2002, which established the first bonus depreciation provisions under IRC 168(k). This act was designed to spur investment by allowing businesses to recover more of the asset’s cost upfront. The other options contain inaccuracies: initial rules targeted new property rather than only used equipment, and while leasing companies can benefit from accelerated depreciation on property they own, that’s a consequence rather than the defining origin of bonus depreciation. Later laws expanded and changed the rules, but the origin is the 2002 act.

Bonus depreciation accelerates tax relief by letting you deduct a large portion of the cost of qualifying property in the first year, in addition to regular depreciation. The true statement is that bonus depreciation was created by the Job Creation and Worker Assistance Act of 2002, which established the first bonus depreciation provisions under IRC 168(k). This act was designed to spur investment by allowing businesses to recover more of the asset’s cost upfront. The other options contain inaccuracies: initial rules targeted new property rather than only used equipment, and while leasing companies can benefit from accelerated depreciation on property they own, that’s a consequence rather than the defining origin of bonus depreciation. Later laws expanded and changed the rules, but the origin is the 2002 act.