Sole proprietor, CA-based software consultant, planning to buy and put into service a $3,000 laptop in 2026 (outside of the de minimis safe harbor rule), claiming 100% federal bonus depreciation. 1. Can you confirm computers placed in service after 2017 are excluded from 'listed property' under §280F, and that this means no business-use-percentage record keeping mandate applies for federal bonus depreciation recapture purposes? (see https://www.irs.gov/newsroom/new-rules-and-limitations-for-depreciation-and-expensing-under-the-tax-cuts-and-jobs-act) 2. If my business use drops to 0% in a future year, and I keep the laptop for 100% personal use, under bonus depreciation of NON-listed property the laptop does not need to be recaptured, do you confirm? ref: https://www.cspcpa.com/wp-content/uploads/2018/01/Computers-as-Listed-Property.pdf

Your first question is confirmed. The TCJA removed computers and peripherals from the listed property category under §280F, effective for property placed in service after December 31, 2017. Because the laptop is no longer listed property, you are not subject to the strict contemporaneous business-use log requirements that listed property triggers, and the 50% business-use threshold that would otherwise limit your depreciation method does not apply.

Your second question is where I'd pump the brakes a bit. The removal from listed property does eliminate the §1245 recapture rules that are specific to listed property dropping below 50% business use. However, §1245 recapture more broadly still applies when you dispose of depreciable property. If you fully convert the laptop to personal use, that conversion is treated as a disposition for depreciation purposes. You would recognize ordinary income equal to the lesser of the depreciation claimed or the fair market value of the laptop at the time of conversion. On a $3,000 laptop fully depreciated in 2026, if the laptop is worth, say, $1,500 when you convert it to personal use in 2028, you'd owe ordinary income tax on $1,500 that year. The fact that it's no longer listed property does not shield you from that general §1245 recapture on conversion to personal use.

California also does not conform to federal bonus depreciation, so your CA return will require a separate depreciation calculation. You'll have a timing difference to track for state purposes.