Bonus Depreciation is a tax incentive that allows a business to immediately deduct a large percentage of the purchase price of eligible business assets rather than writing them off over the "useful life" of that asset. This incentive is usually a stimulus to encourage businesses to buy equipment and invest in themselves, which could stimulate economic growth.

Under the U.S. tax code, most tangible depreciable assets with a recovery period of 20 years or less are eligible for bonus depreciation. This strategy includes machinery, equipment, computers, appliances, furniture, and certain types of real property, such as qualified improvement property.