Bonus depreciation is something the US government implemented to help spur the economy.  Basically, you can deduct 50% of the cost of a long-term asset (which is something that lasts more than a year) in the first year.  After this, you will take the regular depreciation for the asset.

Actually, the bonus depreciation is for those assets beyond the $250,000 limit for Section 179.  Although, there is no requirement that the asset be used more than 50% for business purposes.  What’s more, there is no income limit.  So, it is possible to use the deduction even if your company posted a loss.

However, the IRS has not extended bonus depreciation beyond 2009.