2026 Tax Year · Section 179 + 100% Bonus Depreciation

Buy the equipment this year. Deduct the whole thing this year.

Section 179 lets your business write off up to $2,560,000 of equipment on your 2026 return, and 100% bonus depreciation covers what 179 leaves behind. Finance the purchase and the math gets better: the full deduction lands in 2026 while your payments spread across the term.

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Section 179 savings calculator

Estimate your 2026 first-year deduction and tax savings.

Section 179 deduction$0
100% bonus depreciation$0
Total first-year deduction$0
Estimated tax savings$0
Net equipment cost$0

Estimate only. Assumes equipment placed in service in 2026 and sufficient taxable income. Your actual benefit depends on entity type, income, and state rules. AB Funding LLC does not provide tax advice; confirm your numbers with your tax professional.

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The 2026 numbers

Congress made 100% bonus depreciation permanent and raised the Section 179 cap. If your business buys equipment, 2026 is the strongest write-off environment in years.

$2,560,000
Maximum Section 179 deduction for the 2026 tax year.
$4,090,000
Spending level where the 179 cap starts to phase out. Most businesses never get near it.
100%
Bonus depreciation on qualified equipment, now permanent. It picks up whatever Section 179 leaves.
Dec 31
Equipment must be in service by year end to count for 2026. In service means delivered and working, not ordered.

Why financing makes the deduction work harder

Section 179 does not care whether you paid cash. Financed equipment qualifies the same as a cash purchase, and the full deduction lands in the year the equipment goes to work.

Pay cash and you trade a pile of working capital for the write-off. Finance it and you keep your cash, make a first payment or two this year, and still deduct the entire purchase price on your 2026 return. For most profitable businesses, first-year tax savings run several times the total of this year's payments.

Used equipment qualifies. Titled vehicles over 6,000 lbs GVWR qualify with their own limits. Your tax professional has the final word on your situation; we handle the financing side.

Example: $250,000 excavator, financed in November

Purchase price$250,000
2026 first-year deduction$250,000
Tax savings at a 32% rate$80,000
Payments made in 2026~2 months
Cash kept in the businessWorking capital stays put

The calendar is the catch

The deduction follows the in-service date, not the order date. Every December, buyers learn the hard way that dealers sell out, transport schedules fill, and lender queues grow. Work backward from December 31.

October

Pick the equipment, get approved

Approvals hold while you shop. Locking financing early costs nothing and removes the December scramble.

By late November

Sign and schedule delivery

Contracts signed by Thanksgiving leave room for transport, installation, and the paperwork that always takes a week longer than promised.

December

In service before the 31st

Delivered, installed, working. Hit that and the full deduction belongs to your 2026 return.

Common questions

Does financed equipment qualify for Section 179?

Yes. You deduct the full purchase price in year one even though you pay for the equipment over the term. That gap between deduction now and payments later is the whole reason year-end financing volume spikes.

Does used equipment count?

Yes. New and used both qualify for Section 179, and used equipment also qualifies for bonus depreciation as long as it is new to your business.

What does "placed in service" mean?

Ready and available for use in your business. A machine sitting on the dealer's lot on January 2 goes on your 2027 return, no matter when you signed.

Can I take Section 179 and bonus depreciation on the same purchase?

Yes. Section 179 applies first, then 100% bonus depreciation covers the remaining basis. In practice most purchases under the cap get a full first-year write-off either way.

Is this tax advice?

No. We finance equipment; we do not prepare returns. Bring these numbers to your CPA and have them confirm what applies to your entity, your income, and your state.

Lock the financing before the year-end rush

Apply in about two minutes, get a decision fast, and take delivery on your schedule instead of December's.

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Prefer a conversation? Book 15 minutes or call or text Aubrey at (949) 981-8817.

Tax figures on this page reflect the 2026 tax year: a $2,560,000 Section 179 limit with a phase-out beginning at $4,090,000 in total equipment purchases, and 100% bonus depreciation on qualified property. Figures are for education only and are not tax advice. Deduction availability depends on taxable income, entity type, property type, and state conformity. Consult your tax professional before acting. AB Funding LLC is not a bank. We connect businesses with third-party financing sources. Credit approval is subject to underwriting requirements.