Section 179 Calculator 2025
Calculate your Section 179 tax deduction and maximize your business equipment tax savings
Business Information
Equipment Purchases
| Description | Category | Cost | Qualified | Actions |
|---|---|---|---|---|
Complete Guide to Section 179 Deduction
What is Section 179?
Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment and software purchased or financed during the tax year. Instead of depreciating assets over several years, you can expense the entire cost in the year of purchase, providing immediate tax relief and improving cash flow.
2025 Section 179 Limits
- Maximum Deduction:$1,220,000 (up from $1,160,000 in 2024)
- Spending Cap (Phaseout):$3,050,000 (up from $2,890,000 in 2024)
- Bonus Depreciation:60% for 2025 (down from 80% in 2023)
- Business Income Limit:Cannot exceed total business taxable income
Qualifying Property
To qualify for Section 179, property must be:
- Tangible personal property (machinery, equipment, vehicles, furniture)
- Off-the-shelf computer software
- Qualified improvement property (improvements to interior of nonresidential buildings)
- Used more than 50% for business purposes
- Purchased and placed in service during the tax year
Specific Examples of Qualifying Equipment
✓ Qualifies
- • Manufacturing equipment
- • Office furniture and equipment
- • Computers and servers
- • Business vehicles under 6,000 lbs GVWR
- • Heavy SUVs and trucks (with limits)
- • Agricultural equipment
- • Restaurant equipment
- • Security systems
✗ Does Not Qualify
- • Buildings and land
- • Property used outside the US
- • Property used for lodging
- • Air conditioning and heating units
- • Property leased to others
- • Intangible assets
- • Property gifted or inherited
- • Used property from related parties
Disclaimer: This calculator provides estimates based on 2025 federal tax rules. Tax laws are complex and subject to change. State taxes, alternative minimum tax, and other factors may affect your actual tax situation. Always consult with a qualified tax professional before making equipment purchase decisions based on tax considerations.