The Tax Cuts and Jobs Act temporarily allowed 100 percent bonus depreciation, or full expensing, of most equipment investment and permanently increased the amount of investment that can be expensed by small businesses under section 179. A review of the data shows that take-up rates for bonus depreciation and section 179 expensing are well below 100 percent. This is true even for some profitable C corporations and pass-throughs that have sufficient profit to benefit from the deduction.

The report was originally published by Tax Notes Federal.