Tax Deduction Solutions

For manufacturers looking to make a machinery investment, the time has never been better.

The “One Big Beautiful Bill Act,” signed into law in July 2025, provides two key opportunities for businesses to maximize their deduction and get more from their machinery investment.

OPTION 1: SECTION 179

Section 179 is designed for small and mid-sized businesses making capital investments, such as equipment and machinery. Businesses can now deduct up to $2.5 million in qualifying capital equipment per year. This allows many businesses to write off the entire cost of the machinery they purchase, lease, or finance in the year it is delivered, starting January 20, 2025. Please note that there is a dollar-for-dollar phaseout if total qualifying purchases exceed $4 million, fully phasing out at $6.5 million.

OPTION 2: BONUS DEPRECIATION

Designed for businesses investing over $2.5 million in capital equipment, as there is no limit on this deduction. Bonus depreciation is applied after the Section 179 deduction is claimed. The One Big Beautiful Bill Act restored and made permanent the 100% bonus depreciation businesses can write off of the cost of the machinery they purchase, lease, or finance in the year it is delivered, starting January 20, 2025.

QUALIFYING INVESTMENTS INCLUDE:

Any of the following items that have been purchased or leased on a $1.00 buyout lease:

  • New and used machinery
  • Computers and off-the-shelf software
  • Tangible personal property used in business
  • Office furniture and fixtures

To qualify for these deductions, equipment must be delivered by the end of the year.

If you have any questions regarding these deductions or would like more information on how these deductions can actually pay for your first year’s lease payments on the machinery you are considering, contact the leasing department at Stiles Machinery. 

Questions? Talk to us.

Jeff Bates, Leasing Manager
p 586-764-3415

Nick Rusche, Leasing Specialist
p 616-699-3873

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