As a small business owner in Jamestown or the Southern Tier of New York, making smart decisions about equipment purchases and asset write-offs can have a big impact on your bottom line and your 2026 tax return. Two powerful tools to recover the cost of business property are the Section 179 deduction and bonus depreciation — and each works a bit differently.
Section 179 deduction allows you to immediately expense certain qualifying business property instead of depreciating it over many years. For 2026, businesses can deduct up to $1,260,000 in qualified equipment and property placed in service during the year. This deduction begins to phase out when total purchases exceed $3,270,000, meaning many small and mid-sized businesses can take full advantage if they invest in new assets.
Qualifying property for Section 179 includes tangible personal property (like machinery, vehicles used for business, computers, and office equipment), certain software, and qualified real property improvements (such as interior upgrades, HVAC, fire alarm, and security systems). You can choose which assets to expense under Section 179, and any amount you cannot use because of business income limits can be carried forward to future years.
Bonus depreciation, on the other hand, lets businesses take an immediate first-year write-off of 80% of the cost of eligible property placed in service in 2026. There are no income limits, and both new and used property can qualify. However, bonus depreciation generally does not apply to certain qualified real property improvements like roofs, HVAC, or fire protection systems.
A key difference is flexibility: Section 179 gives you the choice of how much to expense, while bonus depreciation applies to all or none of the same class of assets in a year.
Choosing between Section 179 and bonus depreciation depends on your taxable income, your planned asset purchases, and your long-term tax strategy. At Gleason Tax Advisory, we help Southern Tier business owners evaluate these options so you can make the most tax-advantaged decisions for 2026 and beyond.
