Section 179 Deduction Calculator
Calculate the Section 179 deduction for business equipment purchases. Deduct the full cost of qualifying property in the year you buy it.
📅 Tax Year:
Calculate Section 179 Deduction
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Must be >50% for Section 179
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All qualifying property purchased
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Limits deduction to income
How It Works
Section 179 allows businesses to deduct the full purchase price of qualifying equipment in the year of purchase, rather than depreciating it over several years.
2026 Limits
| Limit | Amount |
|---|---|
| Maximum Deduction | $1,250,000 |
| Phaseout Threshold | $3,130,000 |
Key Rules
- Equipment must be used >50% for business
- Deduction cannot exceed taxable business income
- Phaseout: Deduction reduced dollar-for-dollar when total purchases exceed threshold
- Excess can be carried forward to future years
Qualifying Property
- Equipment and machinery
- Office furniture and computers
- Business vehicles (with limits for SUVs)
- Software (off-the-shelf)
- Qualified improvement property
Not qualifying: Real estate, land improvements, inventory, property used outside the U.S.
Examples
Example: $75,000 Equipment, $100k Income
Full $75,000 deductible (under limits)
Tax savings at 25%: $18,750
What this calculator does
This page turns the visible tax inputs into a planning estimate that can be checked against official forms and records. It is designed for quick comparison, not as a substitute for professional tax advice.
How to use this calculator
- Enter the filing status, income, deduction, credit, withholding, and other fields that apply to your situation.
- Run the calculator and review the tax estimate, rate, deduction, or planning result shown on the page.
- Compare the result with IRS forms, state rules, and your own records before making payment or filing decisions.
Frequently Asked Questions
Section 179 deduction calculator 2026?
Start with the key tax inputs and keep each number easy to verify. For the Section 179 Deduction Calculator, start with asset cost, placed-in-service date, business-use percentage, taxable business income, total Section 179 property placed in service, and vehicle limits. Then use: allowed Section 179 = eligible cost, limited by the annual dollar cap, investment phaseout, business-use percentage, and taxable income. For tax years beginning in 2026, the maximum Section 179 deduction is $2,560,000 and the phaseout starts after $4,090,000 of qualifying property. Read the result as current-year deduction, carryforward, and remaining basis for depreciation. If business use later drops to 50% or less, recapture can bring some deduction back into income.
How much section 179 can I deduct?
Use the Section 179 Deduction Calculator with asset cost, placed-in-service date, business-use percentage, taxable business income. The working formula is allowed Section 179 = eligible cost, limited by the annual dollar cap, investment phaseout, business-use percentage, and taxable income. For tax years beginning in 2026, the maximum Section 179 deduction is $2,560,000 and the phaseout starts after $4,090,000 of qualifying property. Check current-year deduction, carryforward. If business use later drops to 50% or less, recapture can bring some deduction back into income.
Section 179 vehicle deduction calculator?
Use the Section 179 Deduction Calculator with asset cost, placed-in-service date, business-use percentage, taxable business income. The working formula is allowed Section 179 = eligible cost, limited by the annual dollar cap, investment phaseout, business-use percentage, and taxable income. For tax years beginning in 2026, the maximum Section 179 deduction is $2,560,000 and the phaseout starts after $4,090,000 of qualifying property. Check current-year deduction, carryforward. If business use later drops to 50% or less, recapture can bring some deduction back into income.
Section 179 business income limit calculator?
Use the Section 179 Deduction Calculator with asset cost, placed-in-service date, business-use percentage, taxable business income. The working formula is allowed Section 179 = eligible cost, limited by the annual dollar cap, investment phaseout, business-use percentage, and taxable income. For tax years beginning in 2026, the maximum Section 179 deduction is $2,560,000 and the phaseout starts after $4,090,000 of qualifying property. Check current-year deduction, carryforward. If business use later drops to 50% or less, recapture can bring some deduction back into income.
Equipment tax deduction calculator section 179?
Use the Section 179 Deduction Calculator with asset cost, placed-in-service date, business-use percentage, taxable business income. The working formula is allowed Section 179 = eligible cost, limited by the annual dollar cap, investment phaseout, business-use percentage, and taxable income. For tax years beginning in 2026, the maximum Section 179 deduction is $2,560,000 and the phaseout starts after $4,090,000 of qualifying property. Check current-year deduction, carryforward. If business use later drops to 50% or less, recapture can bring some deduction back into income.
Section 179 calculator for financed equipment?
Financing does not automatically block Section 179. The bigger question is whether the equipment is eligible, placed in service during the year, and used more than 50% for business. Enter the full eligible cost, not just the down payment, along with business-use percentage and taxable business income. For 2026, the maximum Section 179 deduction is $2,560,000 and the phaseout starts after $4,090,000 of qualifying property. Loan payments are a cash-flow issue, not the deduction limit.
Section 179 recapture calculator?
Use the Section 179 Deduction Calculator with asset cost, placed-in-service date, business-use percentage, taxable business income. The working formula is allowed Section 179 = eligible cost, limited by the annual dollar cap, investment phaseout, business-use percentage, and taxable income. For tax years beginning in 2026, the maximum Section 179 deduction is $2,560,000 and the phaseout starts after $4,090,000 of qualifying property. Check current-year deduction, carryforward. If business use later drops to 50% or less, recapture can bring some deduction back into income.
Use Cases
- Calculating the maximum Section 179 deduction for new or used business equipment
- Determining if your equipment purchase qualifies for immediate expensing vs depreciation
- Estimating tax savings from deducting the full cost of qualifying property in year one
- Comparing Section 179 with bonus depreciation to optimize your deduction strategy
- Planning year-end equipment purchases to reduce current-year taxable business income
Assumptions & Limitations
- Uses current IRS Section 179 deduction limits and phase-out thresholds for the selected year
- Section 179 deduction cannot exceed your taxable business income for the year
- Phase-out begins when total equipment placed in service exceeds the threshold (dollar-for-dollar reduction)
- Does not combine Section 179 with bonus depreciation calculations in a single result
- Vehicle deductions are subject to separate luxury auto limits
- Both new and used qualifying property is eligible for Section 179
Sources & References
- IRS Publication 946 — How to Depreciate Property
- IRC Section 179 — Section 179 deduction overview and limits
- IRS Form 4562 — Depreciation and Amortization
- IRS Publication 535 — Business Expenses
- IRS Publication 463 — Travel, Gift, and Car Expenses (vehicle limits)
Disclaimer: This calculator provides estimates for educational purposes only. It does not constitute tax advice. Consult a qualified tax professional for advice specific to your situation.