100% Bonus Depreciation Is Back, OBBBA Adds Fine Print

Bonus depreciation is like that one client request that keeps coming back with a new date and a new twist: “Can we still write it off this year?” Congress just made 100% bonus depreciation permanent under the One Big Beautiful Bill Act, and the IRS quickly followed with Notice 2026-11 to spell out who qualifies, what elections exist, and why timing still runs the show. If you do tax work, you will end up in the weeds on “acquired” versus “placed in service” again, so it’s worth getting the nuts and bolts straight now. 

What changed, in plain terms?

The big shift is simple: qualified property acquired after January 19, 2025 can again get a 100% additional first-year depreciation deduction. 

The notice also confirms a practical point that matters in real engagements: taxpayers may generally rely on the existing bonus depreciation regulations (with updated dates). That keeps planning familiar for most businesses buying equipment, furniture, computers, certain vehicles, and qualified improvement property. 

Where do professionals still get tripped up on timing?

The deduction still depends on two separate concepts: acquisition and placed in service. Clients love to talk about purchase orders, deposits, and signed contracts. The return cares about whether the asset was ready and available for its intended use. 

That means you can end up with property acquired in the right window but not deductible yet because the asset never became usable by year-end. In practice, this shows up constantly with installs, tenant improvements, and equipment waiting on permitting or integration. 

If you want an easy internal control test, ask: could the business use the asset for its specific purpose on that date? If the answer is “not really,” you are probably not there yet. 

Which elections matter most this year?

Notice 2026-11 highlights elections that can change the tax result fast, especially for clients where state conformity, NOL posture, or financing optics drive the decision. 

Key elections include: 

• Reduced-rate election (transition rule): For property placed in service during the first tax year ending after January 19, 2025, taxpayers may elect 40% bonus depreciation instead of 100% (or 60% for certain longer-production-period property and certain aircraft). This is a planning lever when 100% does not pencil out. 
• Election out by class of property: Taxpayers may elect not to claim bonus depreciation for a class of property for the year. That election applies consistently across that class. 
• Component election for self-constructed property: The notice points taxpayers back to existing rules that can allow certain acquired or self-constructed components of larger self-constructed property to qualify, subject to the regulatory conditions and documentation burden.

This is where you should “kick the tires” on the client’s full picture. A 100% deduction looks great until you run the state impact, the loss profile, or the next-year forecast and realize there is no free lunch.

Why are sound recordings suddenly part of the tax conversation?

OBBB added qualified sound recording productions as potentially eligible property. Notice 2026-11 clarifies the timing mechanics: 

• Treated as acquired when principal recording commences.
• Treated as placed in service at initial release or broadcast. 
• Eligible if production commences in a taxable year ending after July 4, 2025, and the recording is produced and recorded in the United States. 
• Taxpayers may also elect not to take the additional first-year depreciation for a qualified sound recording production.

Most firms will see this rarely. Firms with entertainment, media, or creator-economy clients should flag it now, because the placed-in-service trigger (release or broadcast) does not behave like typical fixed assets.

Takeaway for busy practitioners

Notice 2026-11 gives taxpayers workable rules now, and it signals proposed regulations later. The practical risk sits in the same place it always does: timing, documentation, and elections. 

If you want one clean mindset for client conversations, borrow Ben Graham’s line: “The essence of investment management is the management of risks, not the management of returns.” Bonus depreciation can juice deductions, but the real win comes from controlling the facts around acquisition, placed in service, and elections, so your position holds up when someone asks for support.

One more thing to put on your radar as filing season opens: the House Ways and Means Committee just moved a separate modernization bill that has nothing to do with depreciation, but it hits your day-to-day pain points. On January 14, 2026, the committee advanced H.R. 6956, the BARCODE Efficiency Act, by 42–0. It would require scannable barcodes on electronically prepared returns that get printed and mailed, and it would push the IRS to use scanning/OCR-style tools for paper returns and correspondence when those tools beat manual entry. If it becomes law, it could speed up refunds for paper filers and cut down on dumb transcription errors that waste everyone’s time.