In December 2017, Congress passed the Tax Cuts and Jobs Act expanding the Section 179 deduction limit for new and used equipment. A deduction limit of $1,160,000 is available on the cost of new and used capital equipment purchased with an investment cap of $2,890,000 to get the maximum deduction.

How Does Section 179 Work?

To benefit from the Section 179 deduction, a business must meet specific criteria:

1. Eligible Property: New and used equipment purchases.

2. Purchase and Use: The equipment must be purchased and placed into service during the tax year in which the deduction is claimed.

How much can you save? There is a limit on the total deduction amount, which may change annually due to tax laws. Additionally, there was a cap on the total cost of eligible equipment. These limits were designed to benefit small and medium-sized businesses more than larger corporations. The IRS provides an easy-to-use calculator to help you estimate your tax savings — click here to use the calculator.

IMPORTANT: This information is provided as a customer service by United Construction & Forestry and United Ag & Turf. We strongly recommend that you consult with your tax advisor regarding how these tax-saving opportunities apply in your situation.