Bonus Depreciation
Bonus depreciation is an additional first-year deduction allowing immediate expensing of eligible property rather than recovery over its normal life. It can apply to used property acquired in an asset purchase, subject to eligibility rules.
Why Bonus Depreciation Matters in a Laundromat Sale
Bonus depreciation changes the after-tax cost of a laundromat acquisition, because a large share of the price is typically allocated to equipment. IRS Publication 946 and Notice 2026-11 state that P.L. 119-21 restored a permanent 100% additional first-year depreciation deduction for eligible qualified property acquired and placed in service after January 19, 2025 (Source: IRS Publication 946; IRS Notice 2026-11). Related-party rules, acquisition and placed-in-service dates, business use, basis, and state conformity all change the result, so nothing here is a promise of a deduction.
Example
A buyer allocates $215,000 of a $400,000 purchase to laundry equipment. If the property and the transaction qualify, that allocation can produce a substantially larger first-year deduction than straight-line recovery would — which is exactly why buyers push for equipment-weighted allocations and sellers push back.
What to Check
- Confirm eligibility for used property with your CPA, including related-party rules.
- Check acquisition date, placed-in-service date, and business use.
- Verify whether your state conforms; many do not.
Where This Comes Up
- Form 8594 and Laundromat Purchase Price Allocation
- Section 179
- Taxes When Selling a Laundromat: What Drives Your After-Tax Number
- Laundromat Valuation: How Stores Are Priced and Why
Related Terms
- Section 179 — Section 179 is an election to expense the cost of qualifying property in the year it is placed in service
- FF&E — FF&E stands for furniture
- Form 8594 — Form 8594 is the IRS Asset Acquisition Statement that buyer and seller each file when a group of assets constituting a trade or business is transferred and g...
- Retool — A retool is the replacement of a laundromat's equipment package
See the full laundromat glossary for all 78 terms.
The Next Step
Sources
- IRS, Publication 946 and Notice 2026-11 on additional first-year depreciation — https://www.irs.gov/publications/p946
This page is general information about laundromat transactions, not legal, tax, or investment advice, and not a guarantee of sale price, timing, or financing approval. Verify current rules with your own CPA, attorney, lender, and the relevant state or municipal agency before acting.