State-by-State Section 179 & Bonus Depreciation Guide

How each U.S. state handles Section 179 and bonus depreciation for 2025-2026

Important Disclaimer

State tax laws change frequently and may be updated retroactively. This guide provides general information as of 2025, but you should always verify current rules with your state's tax authority or a qualified tax professional. Click on your state's website link below for the most current official information.

Section 179 Conformity

Most states conform to federal Section 179 deductions, though some have their own limits or modifications.

Bonus Depreciation Conformity

Only 18 states fully conform to federal bonus depreciation. Many require addbacks or have caps on deductions.

OBBB Act Impact

Some states have decoupled from OBBB Act changes. Check your state's status to understand 2025-2026 implications.

State Conformity Table

Click on a state's website to visit their official tax authority for detailed, current information

State	Section 179 (2025-2026)	Bonus Depreciation (2025-2026)	Notes	Official Website
Alabama	Conforms	Conforms	Generally follows federal rules	Visit
Alaska	Conforms	Partial	State conforms, but local jurisdictions may decouple	Visit
Arizona	Conforms	Partial	Bonus depreciation only for assets with 10 year or less class life	Visit
Arkansas	Conforms	Conforms	Generally follows federal rules	Visit
California	Conforms	Does Not Conform	Requires complete addback of bonus depreciation	Visit
Colorado	Conforms	Conforms	Generally follows federal rules	Visit
Connecticut	Conforms	Partial	May have modifications for certain property types	Visit
Delaware	Conforms	Partial	Gross receipts tax ignores depreciation	Visit
District of Columbia	Conforms	Conforms	Generally follows federal rules	Visit
Florida	N/A	N/A	No corporate income tax	Visit
Georgia	Conforms	Conforms	Generally follows federal rules	Visit
Hawaii	Conforms	Partial	May require adjustments	Visit
Idaho	Conforms	Conforms	Generally follows federal rules	Visit
Illinois	Conforms	Partial	Requires addback of federal depreciation, then subtraction of Illinois version	Visit
Indiana	Conforms	Conforms	Generally follows federal rules	Visit
Iowa	Conforms	Conforms	Generally follows federal rules	Visit
Kansas	Conforms	Conforms	Generally follows federal rules	Visit
Kentucky	Conforms	Conforms	Generally follows federal rules	Visit
Louisiana	Conforms	Conforms	Generally follows federal rules	Visit
Maine	Conforms	Pending	Governor authorized to conform contingent on legislative action	Visit
Maryland	Conforms	Does Not Conform	Proactively decoupled from OBBB Act changes	Visit
Massachusetts	Conforms	Partial	May have limitations or modifications	Visit
Michigan	Conforms	Conforms	Generally follows federal rules	Visit
Minnesota	Partial	Partial	Has own Section 179 limits, may differ from federal	Visit
Mississippi	Conforms	Conforms	Generally follows federal rules	Visit
Missouri	Conforms	Conforms	Generally follows federal rules	Visit
Montana	Conforms	Conforms	Generally follows federal rules	Visit
Nebraska	Conforms	Conforms	Generally follows federal rules	Visit
Nevada	N/A	N/A	No corporate income tax	Visit
New Hampshire	Partial	Does Not Conform	Limits deduction to $500,000; requires addback of bonus depreciation	Visit
New Jersey	Conforms	Does Not Conform	Requires complete addback of bonus depreciation	Visit
New Mexico	Conforms	Conforms	Generally follows federal rules	Visit
New York	Conforms	Does Not Conform	Requires complete addback of bonus depreciation	Visit
North Carolina	Conforms	Conforms	Generally follows federal rules	Visit
North Dakota	Conforms	Conforms	Generally follows federal rules	Visit
Ohio	N/A	N/A	Commercial Activity Tax doesn't allow depreciation deductions	Visit
Oklahoma	Conforms	Conforms	Generally follows federal rules	Visit
Oregon	Conforms	Partial	May have modifications	Visit
Pennsylvania	Conforms	Partial	May require adjustments	Visit
Rhode Island	Conforms	Does Not Conform	Proactively decoupled from OBBB Act changes	Visit
South Carolina	Conforms	Conforms	Generally follows federal rules	Visit
South Dakota	N/A	N/A	No corporate income tax	Visit
Tennessee	N/A	N/A	No corporate income tax (Hall Income Tax repealed)	Visit
Texas	N/A	N/A	No corporate income tax; franchise tax generally conforms	Visit
Utah	Conforms	Conforms	Generally follows federal rules	Visit
Vermont	Conforms	Partial	May have modifications	Visit
Virginia	Conforms	Does Not Conform	Proactively decoupled from OBBB Act changes	Visit
Washington	N/A	N/A	No corporate income tax; B&O tax doesn't allow depreciation	Visit
West Virginia	Conforms	Conforms	Generally follows federal rules	Visit
Wisconsin	Conforms	Does Not Conform	Bonus depreciation capped at $25,000 per asset	Visit
Wyoming	N/A	N/A	No corporate income tax	Visit

Key Takeaways for Multi-State Businesses

• Track state-by-state differences: If you operate in multiple states, you'll need to make adjustments for each state's conformity status.

• Section 179 is more widely accepted: Most states that reject bonus depreciation still conform to Section 179, making it a safer choice for multi-state operations.

• Documentation is critical: Keep detailed records of equipment purchases and depreciation elections for each state where you file.

• Monitor legislative changes: States may update their conformity positions at any time, sometimes retroactively.

• Professional guidance recommended: State tax compliance for depreciation is one of the most complex areas. Work with a tax professional who understands multi-state taxation.