Farm Equipment Appraisers

FAQ

What qualifies for 100% bonus depreciation?

Qualified property for 100% bonus depreciation is new or used tangible business property with a MACRS recovery period of 20 years or less that is acquired and placed in service after January 19, 2025.

For farm operations, this covers most of what fills your equipment yard and shop. The rule is generous about condition: equipment does not have to be brand-new to qualify, it only has to be new to your business (buying a used combine from an unrelated seller still counts). What matters more than age is the recovery period and the placed-in-service date, since equipment purchased earlier but not yet in operation on the farm after that date can still qualify.

Property that typically qualifies includes:

  • Farm machinery and equipment with a MACRS recovery period of 20 years or less, including tractors, combines, planters, sprayers, and grain handling equipment.
  • Used equipment acquired from an unrelated party, as long as it is new to your operation.
  • Heavy trucks and certain vehicles used in the farming business with a useful life of 20 years or less.
  • Farm buildings and improvements with a qualifying recovery period, such as machine sheds.
  • Certain intangible assets, such as computer software used in the operation.

A few conditions can disqualify an otherwise eligible purchase: equipment bought from a related party generally does not qualify, and simply purchasing an asset is not enough. It must actually be placed in service, meaning ready and available for use in the business, before the deduction applies.

Because the deduction is tied to the depreciable basis of the equipment, an accurate, documented valuation matters when you are substantiating cost allocation or defending the claim later. A farm equipment appraisal from Harvest Equipment Appraisers gives you a USPAP-compliant report that supports your tax position with defensible market value, whether you're reporting a single tractor purchase or an entire equipment fleet acquired in one year. For related questions on deductions, see our FAQ on how much you can write off for farm equipment.