Section 179 Deduction Calculator
2026Calculate Section 179 tax deduction for business equipment purchases. 2026 limit: $1,250,000.
Section 179 Deduction
$100,000.00
Tax Savings
$32,000.00
Net Cost After Deduction
$68,000.00
Deduction Details
| Equipment Cost | $100,000.00 |
| 2026 Section 179 Limit | $2.6M |
| Available Deduction Limit | $2,560,000.00 |
| Section 179 Deduction | $100,000.00 |
| Marginal Tax Rate | 32% |
| Tax Savings | $32,000.00 |
| Effective Net Cost | $68,000.00 |
Use the Section 179 Deduction Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.
Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.
How It Works
This calculator helps you estimate your potential Section 179 tax deduction for qualifying business equipment purchases in 2026. Understanding your Section 179 deduction can significantly reduce your taxable income, allowing you to expense eligible assets immediately rather than depreciating them over several years. For 2026, the maximum Section 179 deduction is $1,250,000, with a phase-out threshold starting at $3,170,000 of qualifying property placed in service.
The calculator determines your Section 179 deduction by first identifying the total cost of qualifying equipment. If this total is below the 2026 deduction limit of $1,250,000, that full amount is generally deductible. However, if the total cost of qualifying property placed in service exceeds the phase-out threshold of $3,170,000, the maximum deduction is reduced dollar-for-dollar by the amount exceeding this threshold.
Remember that the Section 179 deduction cannot exceed your business's taxable income. Also, ensure the equipment is truly 'qualifying property' for Section 179 purposes, generally tangible personal property used in your trade or business. A common mistake is not considering state tax implications, as some states do not fully conform to federal Section 179 rules.
Example: Small Business Equipment Purchase
- 1 A small business purchases $1,500,000 worth of new manufacturing equipment in 2026. Their total qualifying property placed in service for the year is $1,500,000.
- 2 Since the total qualifying property ($1,500,000) is below the phase-out threshold ($3,170,000), the full cost of the equipment up to the maximum deduction limit can be expensed. However, the deduction is capped at the 2026 maximum of $1,250,000.
- 3 The business can claim a Section 179 deduction of $1,250,000 for 2026.
- 4 This deduction directly reduces the business's taxable income, potentially leading to significant tax savings in the current year. The remaining $250,000 of equipment cost ($1,500,000 - $1,250,000) would then be subject to regular depreciation rules.
Source: IRS — Publication 946, How To Depreciate Property · Last updated: April 2026
Frequently Asked Questions
What is the Section 179 deduction limit for 2026?
What qualifies for Section 179 deduction?
Can I use Section 179 for a vehicle?
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