On July 4, 2025, the One Big Beautiful Bill was signed into law—and for business owners, it brings some major reasons to celebrate. Among the sweeping changes, one provision stands out: the return of 100% bonus depreciation for qualifying equipment purchases. Even better? It’s now permanent.
What Changed?
Prior to One Big Beautiful Bill, bonus depreciation was on a steep decline. After peaking at 100% under the 2017 Tax Cuts and Jobs Act, it dropped to 80% in 2023 and was on track to hit 0% by 2027. But One Big Beautiful Bill changed that trajectory—restoring and locking in 100% bonus depreciation for all qualifying assets placed in service after January 19, 2025.
This means businesses can immediately deduct the full cost of new (and used) equipment in the same year it’s put into service, rather than spreading that deduction over several years. Even better:
Unlike Section 179, there is no income limitation, which means bonus depreciation can create or expand a net operating loss.
Applies to purchases AND financed/leased equipment, preserving cash flow.
EBITDA-based interest deductions are back, allowing businesses to deduct more interest and improve their cash position.
In addition to bonus depreciation, the maximum Section 179 deduction was increased to $2.5 million, accompanied by a higher phase-out threshold of $4 million. This especially helps small and medium-sized businesses expense more in the year of purchase.
If you’re planning equipment purchases for 2025 and beyond, talk to your tax professional now. Whether you’re buying or leasing, these updates could dramatically improve your tax position and preserve cash for other investments.
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