Take Advantage of the Section 179 2025 Tax Credit

Summary: Take advantage of the 2025 Section 179 deduction to reduce your tax burden while upgrading equipment, vehicles, or software. Businesses can deduct up to $2.5 million on qualifying purchases placed in service this year, with 100% bonus depreciation available beyond that. From machinery to office tech, Section 179 offers immediate savings, stronger cash flow, and faster growth.

Save big this tax season with the 2025 Section 179 tax credit

Are you aware that your business could save significantly this tax season? The 2025 Section 179 deduction allows small businesses to deduct 100% of the cost of eligible purchases— including machinery and business software—up to $2,500,000, with the deduction phasing out when total qualifying purchases exceed $4,000,000 (fully phased out at $6,500,000). Don’t miss out on this opportunity to lower your tax burden and invest in your business’s future.

If you’re not taking advantage of Section 179 this tax season, your business could be leaving money on the table. Section 179 allows small businesses that purchase, finance, and/or lease eligible items to deduct 100% of the cost, up to $2,500,000, during the first year the asset is placed in service (must be >50% business use). And it’s not just machinery or office equipment that qualifies; the deduction includes software. 2025 offers the highest Section 179 limit to date.

Why Section 179 is a game-changer

Taking the cost of these items as an immediate expense deduction allows your business to get a quick break on your tax burden, whereas capitalizing and then depreciating the asset allows for smaller deductions to be taken over a longer period. Have you been considering upgrading your software? Now is the time to save while taking advantage of an easier way to work. In addition, businesses can take advantage of 100% bonus depreciation on both new and used equipment for the rest of 2025. This is an additional benefit if you need new computers, printers, or tech equipment.

Key benefits of Section 179

Over the years, this write-off has made a big difference for many businesses that now need new equipment or software but put it off due to the lack of available money. With the year ending, you must capitalize on this money-saving tax credit while upgrading your business with the resources you need to continue to grow and stay competitive.

Items that qualify for Section 179 tax credit include:

• Computers and “off-the-shelf” software: Upgrade your business’s technological capabilities.
• Machinery and equipment: Invest in essential tools to enhance productivity.
• Office equipment and furniture: Improve your workspace for better efficiency.
• Heavy equipment: Includes construction machines, farming equipment, tree-work and forestry equipment, paving equipment, drilling rigs, and more.
• General building improvements: HVAC, security systems, fire systems, roofing improvements, and similar projects.
• Property attached to a building: Refrigerators, signs, air conditioners, or heaters.
• Business vehicles: With certain restrictions, vehicles can also qualify.
• Eligible improvements to non-residential buildings: Roofs, security systems, and HVAC improvements.

Maximizing your savings

Remember that to qualify for the Section 179 Deduction, purchases must be bought and put into use between Jan. 1 and Dec. 31 of the tax year you are claiming. Speak to your financial advisor to see how the Section 179 tax deduction can benefit your company in 2025.

Recap: Don't miss out on the 2025 Section 179 tax credit—it's a unique opportunity to reduce your tax burden significantly while investing in your business’s growth and efficiency. Whether you need new equipment, software, or office improvements, Section 179 provides a substantial incentive to make these investments now. Consult with your financial advisor and take advantage of this exceptional tax benefit before the year ends.

Editor’s Note: This post was originally published on Sept. 20, 2023, and has been revamped and updated for accuracy and comprehensiveness.