Section 179 Tax Deduction Benefits

Planning to purchase or finance equipment in 2026? Section 179 may allow your business to deduct the cost of qualifying new or used equipment in the year it is placed in service, helping you invest in what your business needs while potentially reducing your taxable income.*

2026 Section 179 Limits

• Maximum Section 179 Deduction: $2,560,000

• Total Equipment Purchase Limit Before Phaseout: $4,090,000 in qualifying equipment purchases

• Bonus Depreciation Rate: 100% – applicable after Section 179 limits are met

• Deadline: Qualifying equipment must be purchased or financed and placed in service by December 31, 2026, for calendar-year taxpayers.

Section 179 and bonus depreciation may be used together. In many cases, Section 179 is applied first, followed by bonus depreciation on the remaining eligible cost. Eligibility and actual tax savings depend on your business and the property purchased, so always consult your tax advisor.

How Section 179 Works with Equipment Financing

You may not have to pay the full purchase price upfront to take advantage of Section 179. Qualifying equipment can be financed while your business may still be eligible to deduct its full purchase price—subject to IRS requirements and your individual tax situation.

That means you can preserve working capital, put essential equipment to work now and potentially benefit from the deduction for the 2026 tax year.

What Equipment May Qualify?

Eligible property may include new or used business equipment that is purchased and used more than 50% for business purposes, such as:

• Construction equipment
• Trucks, trailers and other qualifying business vehicles
• Manufacturing and fabrication equipment
• Material handling and warehouse equipment
• Printing and packaging equipment
• Agriculture equipment
• Computers, technology and certain off-the-shelf software
• Office furniture and equipment

Certain vehicles, property and improvements are subject to additional rules or deduction limits. Your tax advisor can help determine whether a specific purchase qualifies.

*Please consult your tax consultant/accountant to fully understand the benefits and implications of Section 179.