When used strategically, Section 179 can improve cash flow, lower taxable income, and even free up capital for future growth. But timing and compliance matter — and that’s where expert tax planning makes all the difference. Let's get into it.
.png)
As the year winds down, many business owners start asking one big question:
The answer often depends on how well you understand Section 179 deductions and bonus depreciation — two of the most powerful tax tools available to small and mid-sized businesses in 2025. These provisions can allow you to deduct the full purchase price of qualifying equipment and technology in the year it’s placed in service, rather than spreading the cost over several years.
When used strategically, Section 179 can improve cash flow, lower taxable income, and even free up capital for future growth. But timing and compliance matter — and that’s where expert tax planning makes all the difference.
Section 179 of the IRS tax code allows businesses to immediately expense certain qualifying equipment purchases instead of depreciating them over time. For the 2025 tax year, here are the key limits:
The equipment must be purchased and placed in service by December 31, 2025 to qualify for the deduction for that year.
At Vincere Tax, we help clients determine whether a Section 179 deduction or standard depreciation provides the bigger long-term advantage for their business. Find out here.
In addition to Section 179, businesses can also claim bonus depreciation, which allows an immediate deduction of a large percentage of the remaining cost of qualifying assets after Section 179 limits are applied.
Vincere Tax monitors these thresholds for every client and builds tailored year-end purchasing strategies so you know exactly what to buy — and when — to maximize deductions.
Section 179 only applies to assets placed in service by year-end. If you order new equipment in December but it doesn’t arrive or isn’t used until January, it likely won’t count for the 2025 tax year. That’s why Vincere Tax encourages clients to review their purchasing plans early in Q4 – before supply delays or shipping timelines interfere with year-end deductions.
You reduce this year’s taxable income instead of spreading deductions over multiple years.
The deductions free up capital that you can reinvest in your business.
Replace outdated technology or equipment while lowering your tax obligation.
Upgrade operational capabilities now, getting a head-start on next year’s efficiency.
At Vincere Tax, our advisors run side-by-side projections so you can see exactly how Section 179 impacts your bottom line — before you spend a dollar.
Here are the types of assets that qualify, and do not qualify, for the Section 179 deduction of the IRS tax code. This rule allows businesses to deduct the full purchase price of qualifying equipment and software in the year it is placed in service, rather than depreciating it over several years.
The Section 179 deduction is a key incentive designed to encourage businesses, especially small and medium-sized ones, to invest in equipment and improve their operations.
Section 179 can be a major opportunity — but also a source of confusion. Some business owners over-deduct, others miss qualifying purchases entirely.
📞 Schedule a Section 179 Review with Vincere Tax today to see how much you can save before December 31.
For 2025, the Section 179 deduction limit is $2,500,000, with the phase-out threshold beginning at $4,000,000 in total qualifying purchases.
Yes — both new and used equipment qualify, so long as it’s “new to you,” used more than 50% for business, and placed in service in 2025.
You can still take the full Section 179 deduction in 2025 even if the equipment is financed — as long as it is placed in service by December 31. Vincere Tax can help you structure financing to align with deduction timing.
Yes. Typically, you apply Section 179 first (up to your limit), then you apply bonus depreciation for any remaining qualified basis. Vincere Tax helps clients model both strategies to maximize benefit.
Certain business vehicles qualify — though IRS weight and use restrictions apply. For example, SUVs and trucks with a gross vehicle weight rating (GVWR) above 6,000 lbs may have special limits. Vincere Tax reviews vehicle eligibility and calculates allowable deductions.
Yes — “off-the-shelf” software you purchase for business use qualifies for Section 179 as long as it’s not custom-built and is placed in service in 2025.
The deduction year is based on when the asset is ready and available for use. If you miss the December 31 deadline, the deduction shifts to the next tax year. Vincere Tax helps clients track placement dates to avoid this pitfall.
Not always. If your business is in a loss position or expects low profits next year, standard depreciation or deferring purchase might be a better strategy. Vincere Tax evaluates both short- and long-term implications before recommending Section 179.
State conformity varies — some states cap or disallow Section 179 differently. Vincere Tax helps ensure your federal deduction aligns with state requirements and avoids surprises.
Being audited is comparable to being struck by lightning. You don't want to practice pole vaulting in a thunderstorm just because it's unlikely. Making sure your books are accurate and your taxes are filed on time is one of the best ways to keep your head down during tax season. Check out Vincere's take on tax season!
This post is just for informational purposes and is not meant to be legal, business, or tax advice. Regarding the matters discussed in this post, each individual should consult his or her own attorney, business advisor, or tax advisor. Vincere accepts no responsibility for actions taken in reliance on the information contained in this document.
For business tax planning articles, our tax resources provides valuable insights into how you can reduce your tax liability now, and in the future.
.png)
At Vincere Tax, we've got the skills and know-how to craft a unique, tailored plan just for you. Trust us – we've got the expertise to make it happen!
Speak with an expert Website Terms.png)
.png)
.png)
Copyright © 2025 Vincere Tax| All Rights Reserved
Privacy Policy
.png)
