For California tax purposes, what is the percentage for bonus depreciation under the Tax Cuts and Jobs Act?

The correct answer is that California does not conform to the federal bonus depreciation provisions established under the Tax Cuts and Jobs Act, which allows for 100% bonus depreciation. While the federal tax code gives taxpayers the ability to immediately deduct a significant portion of the cost of qualifying assets, California has chosen to maintain its own depreciation rules that do not include this bonus depreciation feature.

Additionally, for California state tax purposes, most taxpayers will have to follow the Modified Accelerated Cost Recovery System (MACRS) rules without the allowance for bonus depreciation. This distinction is important for taxpayers to understand, as it affects their state tax liability differently than their federal taxes. Therefore, while the federal government allows a full deduction in the year of purchase for eligible assets, California does not permit any bonus depreciation, making the state tax impact less favorable in this respect.