You Have 75 Days to Claim a $2.56 Million Tax Break. Most Business Owners Will Miss It

The Clock Is Already Running

Today is October 17. That leaves 75 days until December 31, 2026, the last day to put equipment into service and deduct it on this year's taxes.

Every year, business owners plan to "deal with it in December." Every year, some of them find out that the machine they ordered on December 10 won't arrive until February, and the deduction moves to next year with it.

What's Available in 2026

Two tax rules work together here.

Section 179: Up to $2,560,000

Section 179 lets you deduct the full purchase price of qualifying equipment in the year you put it into service, instead of depreciating it over several years. Under IRS Revenue Procedure 2025-32, for tax years beginning in 2026: [1]

• Deduction limit: $2,560,000
• Phase-out threshold: the limit shrinks dollar-for-dollar once total qualifying purchases pass $4,090,000
• Heavy SUVs (6,001–14,000 lbs GVWR) are capped at $32,000

100% Bonus Depreciation

The One Big Beautiful Bill Act, signed July 4, 2025, permanently restored 100% bonus depreciation for qualifying property acquired and placed in service after January 19, 2025. [2] It applies after Section 179 and can cover costs above the Section 179 limit. [3] Used equipment can qualify too, as long as it's new to your business. [3]

The Part Most People Miss: You Can Finance It

You don't have to pay cash to get the deduction. Equipment bought with an equipment loan or a finance lease that's treated as a purchase (for example, one with a $1 buyout) can be deducted in full in the year it's placed in service, even though you're paying for it over several years. [4]

Here's a simplified example:

In this example, the business spends about $28,000 in cash this year and gets roughly $50,000 back in tax savings.

Numbers are illustrative. Your actual tax savings depend on your tax situation, so confirm with your accountant.

What Counts (and What Doesn't)

Usually Qualifies

• Machinery and manufacturing equipment
• Computers, servers and off-the-shelf software
• Office furniture and equipment
• Commercial vehicles, and heavy vehicles over 6,000 lbs (with the SUV cap above)
• Many qualified improvements to non-residential buildings, such as roofs, HVAC, fire and security systems [4]

Usually Doesn't

• Land and most buildings
• Equipment used 50% or less for business
• Equipment that's ordered and paid for, but not delivered and working by December 31

Your 75-Day Plan

Now through October 31: Decide

• Sit down with your accountant and estimate your 2026 taxable income
• List the equipment you were going to buy in the next 12 months anyway
• Get quotes and, importantly, delivery dates from vendors

November: Finance and Order

• Apply for equipment financing early. Approval is usually quick, but year-end volume at lenders and vendors slows everything down
• Place orders with enough cushion for shipping delays
• Confirm installation schedules for anything that needs setup

December: Put It in Service

• Make sure equipment is delivered, installed and actually being used for business
• Keep invoices, delivery confirmations and photos of the equipment in use
• Send everything to your accountant before the year closes

Watch the Cost of Money, Too

Financing costs more than it did a few months ago. The Fed raised rates in September and Prime is now 7.00%. [5] Most equipment loans are fixed-rate, so locking one in now protects you from further hikes, but make sure the payment works for your cash flow even before you count the tax savings.

Don't Buy Equipment Just for the Deduction

A tax break makes a good purchase better. It doesn't make a bad purchase good. If you weren't going to use the equipment, saving 25 cents on the dollar in taxes still means losing 75 cents. The best candidates are purchases you already planned for early 2027: moving them up a few weeks can mean a full year's difference in when you get the tax benefit.

The Bottom Line

The deduction is generous, financing makes it accessible, and the deadline doesn't move. The business owners who benefit are the ones who start in October, not the ones who start in December. If you have equipment on your 2027 list, now is the time to get financing in place.

This article is general information, not tax advice. Talk to a qualified tax professional about your situation.

Sources

1. Current Federal Tax Developments, Technical Revisions to Revenue Procedure 2025-32; Reed Tax Group, 2026 Section 179 & Bonus Depreciation
2. MGO, One Big Beautiful Bill Act Expands 100% Depreciation Expensing Opportunities; Dean Dorton, OBBBA Insight: What to Know About Bonus Depreciation
3. Block Advisors, Section 179 Deduction Guide 2026
4. Ameris Equipment Finance, Section 179 Tax Deduction for 2026
5. Federal Reserve, FOMC statement, September 16, 2026; Lendio, Current SBA Loan Interest Rates, October 2026