Section 179: the tax deduction for business equipment
Section 179 is a federal tax deduction that lets a business deduct the full cost of qualifying equipment from its taxable income in the year it's put to use — instead of spreading that deduction across several years of depreciation.
It lowers the income you're taxed on; the actual saving is the tax you would have paid on that amount, not the price of the equipment itself.
Here's how the 2026 limits work, and what changes when you finance the equipment rather than pay cash. General information — confirm how it applies to your business with a qualified tax advisor.
General information, not tax advice. Confirm how Section 179 applies to your business with a qualified tax professional.
What Section 179 is
Section 179 of the Internal Revenue Code lets a business deduct the full cost of qualifying equipment in the year it is placed in service, instead of depreciating it gradually over several years. The intent is to encourage businesses to invest in themselves.
It applies to most new and used business equipment put into service during the tax year — machinery, qualifying vehicles, technology, and more. The mechanics, eligibility, and limits are set by the IRS, and how they apply to any one business is a question for that business's tax professional.
The 2026 numbers
Figures reflect current IRS guidance for the 2026 tax year. "Phase-out" means the maximum deduction is reduced dollar-for-dollar once total equipment purchases exceed the spending cap. Confirm current figures and your eligibility with your tax advisor.
Section 179 vs. bonus depreciation
They are two different accelerated-deduction tools, and they work together. Section 179 is generally applied first, up to its limit and subject to the phase-out above. Bonus depreciation — back at 100% for 2026 — can then apply to remaining eligible cost.
Which combination is right for a given business depends on its income, its equipment spend, and its overall tax position. That is a calculation for a qualified tax professional, not a one-size answer.
Estimate the math
Drag to your equipment amount and select your estimated tax bracket for a rough picture of the deduction, potential tax savings, and net equipment cost. Illustrative only.
Where the financing fits
Section 179 turns on one thing you can control: getting the equipment placed in service within the tax year. Financing — rather than paying cash — is often how a business does that without draining its working capital. The equipment goes to work this year; the cash stays in the business.
Lamare Capital is a California-licensed commercial finance brokerage. We arrange equipment financing from $30,000 to $5,000,000 for business use, matched to the right structure for the deal. The tax outcome is your advisor's call; the financing is ours.
Financing partner: South End Capital, a division of Stearns Bank, N.A. (Member FDIC, Equal Housing Lender). Business-purpose financing only. All financing is subject to lender approval and credit review.
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A short, no-obligation look at equipment financing for your business — from $30K to $5M, structured to get the equipment in service this year.
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For the 2026 tax year, the maximum Section 179 deduction is $2,560,000, with the spending cap (phase-out) beginning at $4,090,000 and the deduction fully phased out at $6,650,000. These figures reflect current IRS guidance; confirm them with your tax advisor.
Yes. Financed equipment can qualify the same way purchased equipment does, provided it is placed in service during the tax year. Financing lets a business put the equipment to work this year while preserving working capital. Your tax advisor confirms the deduction for your situation.
They are separate accelerated-deduction tools that work together. Section 179 is applied first, up to its limit and subject to the phase-out; bonus depreciation, which is 100% for 2026, can then apply to remaining eligible cost. The right combination depends on your tax position — a question for your CPA.
To claim Section 179 for a given tax year, equipment generally must be purchased and placed in service by December 31 of that year. Confirm timing with your tax advisor.
No. Lamare Capital is a commercial finance broker, not a tax advisor. This page is general information based on current IRS guidance. We arrange the financing; how Section 179 applies to your business is for your qualified tax professional to confirm.
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