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Calculate your potential tax savings with our interactive Section 179 calculator
* This calculator provides estimates only. Consult with your tax advisor for specific tax advice and to ensure compliance with current tax laws.
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Understanding Section 179
Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment and/or software purchased or financed during the tax year. This means that if you buy (or lease) a piece of qualifying equipment, you can deduct the FULL PURCHASE PRICE from your gross income.
This is an especially powerful tax strategy for small and medium-sized businesses looking to invest in equipment while reducing their tax burden. Instead of depreciating the equipment over several years, Section 179 allows you to take the entire deduction in the year of purchase.
Key Benefits:
- Immediate tax deduction for the full purchase price
- Reduces taxable income dollar-for-dollar
- Applies to both new and used equipment
- Can be combined with equipment financing
- Helps improve cash flow through tax savings
2024 Limits:
- Maximum deduction: $1,160,000
- Total equipment purchases threshold: $2,890,000
- Deduction phases out dollar-for-dollar above the threshold
Important: This article provides general information about Section 179 and should not be considered tax advice. Tax laws are complex and change frequently. Always consult with a qualified tax professional to understand how Section 179 applies to your specific situation.
About the Author
Alan Johnson
Alan Johnson is the founder and CEO of Vista Pacific Capital, bringing over 15 years of experience in equipment financing and business development. He specializes in helping businesses understand complex financing options and tax strategies to maximize their growth potential.
For personalized equipment financing advice and to discuss how Section 179 can benefit your business, contact Alan directly at alanj@vistapacificcapital.com.