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The Section 179 Deduction

2019 Deduction Limit = $500,000
This deduction is good on new and used equipment, as well as off-the-shelf software. This limit is only good for 2019, and the equipment must be financed/purchased and put into service by the end of the day, 12/31/2019.

2019 Spending Cap on equipment purchases = $2,000,000
This is the maximum amount that can be spent on equipment before the Section 179 Deduction available to your company begins to be reduced on a dollar for dollar basis. This spending cap makes Section 179 a true "small business tax incentive." (Larger businesses that spend more than $2.5 million on equipment will not get the deduction.)

Bonus Depreciation: 50% for 2017
Bonus Depreciation is generally taken after the Section 179 Spending Cap is reached. Note: Bonus Depreciation is available for new equipment only. Used equipment does not qualify for Bonus Depreciation.

Note: A business could write off the entire amount; they might add more equipment this year instead of waiting over the next few years. That is the whole purpose behind Section 179 - to motivate the American economy (and your business) to move in a positive direction. For most small businesses, the entire cost can be written off on the 2017 tax return (up to $500,000).

Limits of Section 179

Section 179 does come with limits - there are caps to the total amount written off ($500,000 for 2019), and limits to the total amount of equipment purchased ($2,000,000 in 2019).

For more information regarding Section 179, please visit: http://www.section179.org/section_179_deduction.htm

The Section 179 Deduction Calculator

Initial Purchase Price:
Section 179 Deduction:
50% Bonus Depreciation Deduction:
Normal 1st Year Depreciation:
Total First Year Deduction:
Cash Savings on your Equipment Purchase:
Final Cost of your Equipment Purchase:


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