§179 → Bonus → MACRS waterfall

What this does

Run the depreciation waterfall in order: §179 → bonus → MACRS. 2025 §179 limits and bonus % by acquisition date are built in.

Visual: waterfall bars show each layer of year-1 write-off.

Rule · waterfall order Always §179 → bonus → MACRS. Mid-quarter if >40% of personal-property basis is placed in service in Q4.

Asset & limits (2025)

Cost of qualifying property Total §179 property placed in service (phaseout) §179 election amount (desired) Business taxable income (TI limit) MACRS class Convention

Bonus % (2025 — depends on dates)

§179 max $2,500,000; phaseout starts at $4,000,000 (complete at $6,500,000). SUV §179 cap $31,300 (not modeled).

Waterfall

Order is always §179 → bonus → regular MACRS. Total write-off is the headline.

Total first-year deduction

—

Remaining MACRS basis after year 1 sits in future years (not shown).

Year-1 write-off waterfall

Composition of year-1 deduction

§179 allowed

—

Bonus

—

Year-1 MACRS

—

Exam trap: Order is always §179 → bonus → regular MACRS. Mid-quarter if >40% of personal-property basis is placed in service in Q4. Bonus % is not one rate for all 2025 assets. Land is never depreciable.

← All widgets Diagnostic home

Study tool only — not official IRS software. Figures labeled 2025 track law/forms through Dec 31, 2025. Confirm against current IRS pubs before the exam.