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The Komatsu Depreciation Estimator
In May of 2003, President Bush signed the Jobs & Growth Act into law.
A provision of this acted changed the amount of tax deductible depreciation expense.
For example, with five-Year MACRS, 50% of the cost of new equipment, in addition to 20% of the remaining cost, can be deducted as depreciation expense in the first year. Half-Year Convention assumed.
Equipment Cost    $ 100,000
The "Bonus" deduction is 50% of cost:        $ 50,000
Plus 20% of the remaining $50,000 $ 10,000
Total First Year Deduction        $ 60,000
The new law applies to equipment purchased after May 5, 2003 but before January 1, 2005. Equipment placed into service between September 10, 2001 and May 6, 2003 still qualifies for the 30% Depreciation Bonus enacted in 2002.
Note: Final IRS regulations have not been published as of yet.
This information should not be construed as tax advise by Komatsu America Corp. For more information, consult the IRS and your tax advisor.