# State conformity to bonus depreciation and section 179

Each state decides whether to follow federal bonus depreciation and the section 179 limits. Many do not, so one server can have two schedules. General information, not tax advice. Talk to your tax advisor about your situation.

## Two examples

| State | Bonus depreciation (168(k)) | Section 179 |
| --- | --- | --- |
| California | Does not conform | $25,000 limit, reduced once purchases exceed $200,000 |
| Oregon | Decoupled for property placed in service in tax years beginning on or after Jan. 1, 2026 (Senate Bill 1507, signed April 9, 2026) | Not covered by the source |

[California FTB, 2025 Form 3885 instructions](https://www.ftb.ca.gov/forms/2025/2025-3885-instructions.html); [RSM, April 13, 2026](https://rsmus.com/insights/tax-alerts/2026/oregon-decouples-federal-bonus-depreciation-extends-ptet.html). Examples only, not every state. Rules change; check the current year.

## How it works

Rolling or fixed-date. Most state income taxes start from the Internal Revenue Code. Rolling-conformity states follow it as amended; fixed-date states follow it as of a date their legislature sets. [RSM](https://rsmus.com/insights/tax-alerts/2025/salt-considerations-from-the-one-big-beautiful-bill-act.html) counts about half the states in each group, and after Public Law 119-21 found that many, but not all, have decoupled from federal bonus depreciation.

Decoupling means an add-back. Oregon's model: add back the difference between the federal bonus deduction and the deduction under section 168(k) as it stood on December 1, 2017. California has its own depreciation form, FTB 3885.

A separate state basis. The asset ends up with a different basis on each return, so the gain and [recapture](https://managedgpus.com/guides/accelerated-depreciation/depreciation-recapture) on a sale can differ too. Keep federal and state records per asset.

Several states can apply. A server in a data center in one state, owned by an LLC formed in another, with owners in a third, is a question for your advisor. The federal side is in [bonus depreciation in 2026](https://managedgpus.com/guides/accelerated-depreciation/bonus-depreciation-2026), [section 179](https://managedgpus.com/guides/accelerated-depreciation/section-179-computer-equipment) and the other [accelerated depreciation guides](https://managedgpus.com/guides/accelerated-depreciation).

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Source: https://managedgpus.com/guides/accelerated-depreciation/state-conformity