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The Farm CPA

RSS By: Paul Neiffer, Top Producer

Paul is now part of the fourth generation in America that is involved in farming and hopes the next generation will be involved also. Through his blog he provides analysis and insight to farmer tax questions.

The Dates for 100% Bonus Depreciation

Aug 11, 2011

We had a reader ask the following question:

"What is the date a farm building has to be built to be 100% tax deductible? Is this for one year (2011) or will it continue for more than the single year?"


We have done a couple other posts on this earlier this year and late last year, but it never hurts to communicate these very valuable dates to our readers.

If a farmer is constructing a new building and the construction commenced after September 8, 2010 and is finished before January 1, 2012, then the total cost is allowed to be 100% depreciated during 2011.  If the building construction commenced before September 9, 2010 and was finished in 2011, then only 50% bonus depreciation is allowed (unless you can segregate out some components that can be 100% bonus depreciated this year).

If the building is not finished by the end of 2011, but is completed in 2012, then the farmer can take 50% bonus depreciation on the building and depreciate the remaining 50% over its taxable life.

Currently, it is 100% bonus depreciation in 2011, 50% bonus depreciation in 2012 and zero bonus depreciation in 2013, but these rules can change at any time.

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