The recent enactment of the "One Big Beautiful Bill Act" (OBBBA) on July 4, 2025, has brought significant changes to the tax landscape for small and midsize businesses. This new tax bill introduces major overhauls to Section 179 expensing and bonus depreciation, which are particularly relevant for equipment sellers.
The OBBBA represents the most comprehensive equipment finance legislation in decades, creating significant opportunities not only for equipment sellers and end-user buyers across the entire ecosystem.
In this article, we will explore how these changes can affect your equipment sales and what you need to know to get the most out of this new tax environment.
In this article...
- Understanding the Changes: Section 179 and Bonus Depreciation
- Five Reasons These Tax Changes Matter to Equipment Sellers
- Your Action Plan: Capitalizing on the New Tax Bill
- Final Thoughts
Understanding the Changes: Section 179 and Bonus Depreciation
Section 179 Expensing
Section 179 of the Internal Revenue Code (IRS) allows businesses to deduct the cost of qualifying equipment and property improvements in the year they are placed in service, rather than depreciating them over time .
The new tax bill has significantly increased the deduction limits under Section 179
Previously, the deduction limit was set at $1.25 million, with a phase-out threshold beginning at $3.13 million. Under the OBBBA, the deduction limit has been doubled to $2.5 million, and the phase-out threshold now starts at $4 million.
Additionally, both the deduction limit and phase-out threshold will be adjusted annually for inflation starting in 2026, ensuring the real value of Section 179 benefits are preserved over time.
Why this matters for equipment sellers: You can now help your customers save on taxes by allowing them to deduct more of their equipment costs. With these new rules, growing businesses have even more reason to invest in equipment, making it easier for them to expand and for you to increase sales.
Bonus Depreciation
Bonus depreciation lets businesses write off a large part of the cost of qualifying equipment in the same year they buy it. Thanks to the new tax bill, this benefit is now back to 100%.
This was first put in place by the Tax Cuts and Jobs Act (TCJA) and was set to decrease to 40% by 2025. However, the OBBBA has now made 100% bonus depreciation permanent for qualified property bought and put into use on or after January 19, 2025.
Why this matters for equipment sellers: Your customers can now fully expense the cost of new and used equipment in the year of purchase. This change is expected to drive increased demand for equipment, as businesses take advantage of the enhanced tax benefits.
5 Reasons These Tax Changes Matter for Equipment Sellers
The changes to Section 179 and bonus depreciation have several important implications for equipment sellers:
1. Increased Sales Opportunities
The higher deduction limits and the restoration of 100% bonus depreciation create a strong incentive for businesses to invest in new equipment. Equipment sellers can leverage these tax benefits to attract more customers and increase sales.
With these new tax rules, you can spotlight the biggest advantage for your customers – significant tax savings the year they acquire equipment. By explaining how financing equipment now helps them save on taxes right away, you give them a powerful reason to make a purchase sooner rather than later.
2. Stronger Customer Relationships
By staying informed about the latest tax changes and educating your customers on how to take advantage of these benefits, you can build stronger relationships with your clients.
By sharing helpful tax information, you show customers that you care about their success. This builds trust, encourages loyalty, and increases the chances they’ll return to do business with you again.
3. Enhanced Marketing Strategies
Equipment sellers can incorporate the new tax benefits into their marketing strategies to differentiate themselves from competitors.
By promoting the immediate tax savings available through Section 179 and bonus depreciation, sellers can create targeted marketing campaigns that resonate with businesses looking to optimize their tax positions.
4. Enhanced Financing Partnership Opportunities
The OBBBA creates new opportunities for equipment sellers to partner with lenders and offer more attractive financing packages.
With the restoration of EBITDA-based interest deductions, customers can deduct more interest on financed equipment, making dealer-arranged financing more competitive versus cash purchases.
Equipment sellers should work closely with finance partners to develop compelling financing programs that capitalize on these enhanced tax benefits.
5. Enhanced Financing Partnership Opportunities
The OBBBA creates new opportunities for equipment sellers to partner with lenders like Beacon Funding and offer more attractive financing packages.
Equipment sellers should work closely with finance partners to develop compelling financing programs that capitalize on these enhanced tax benefits.
PARTNER WITH BEACON FUNDING
Benefits for End-User Buyers and Equipment Sellers
Equipment buyers gain significant advantages under the new legislation.
- Immediate Tax Benefits: Businesses can reduce their taxable income dollar-for-dollar with qualifying equipment purchases through 100% bonus depreciation, providing immediate cash flow benefits.
- Lower After-Tax Borrowing Costs: The EBITDA-based interest limitation allows businesses to deduct more interest on equipment loans, particularly valuable for capital-intensive businesses with substantial depreciation expenses.
- Improved Cash Flow Management: The combination of immediate expensing and enhanced interest deductibility creates powerful cash flow advantages, making equipment financing more attractive than cash purchases for maintaining liquidity.
Your Action Plan: Capitalizing on the New Tax Bill
To make the most of the new tax bill, equipment sellers should consider the following action plan:
Educate Your Customers
Ensure that your customers are aware of the enhanced tax benefits available under the new tax bill. Provide them with clear and concise information on how Section 179 and bonus depreciation work. Inform them how they can maximize their tax savings by purchasing equipment now.
Educate customers to talk to their CPA about the:
- Enhanced interest deductibility benefits when financing equipment purchases.
- How the EBITDA-based calculation can improve their after-tax cost of borrowing.
Promote the Tax Benefits in Your Marketing
Incorporate the new tax benefits into your marketing materials and campaigns.
Highlight the immediate tax savings available through Section 179 and bonus depreciation, and create content that explains the advantages in simple terms.
Use case studies and real-world examples to make the benefits more relatable and compelling.
Emphasize how financing equipment can provide additional tax advantages through enhanced interest deductibility, making it a more attractive option than cash purchases for many businesses.
Partner with Equipment Finance Companies
Develop strategic partnerships with equipment finance like Beacon Funding who can offer competitive financing packages that take advantage of the new Section 179, Bonus Depreciation, and EBITDA-based interest deduction rules.
These partnerships can help you offer customers comprehensive solutions that maximize both immediate expensing benefits and ongoing interest deductions.
Stay Informed and Updated
Stay informed about any further changes to tax laws and regulations that may affect your customers.
Regularly update your knowledge and share relevant information with your clients to keep them informed and engaged.
Final Thoughts
The "One Big Beautiful Bill Act" brings important updates to Section 179 expensing, bonus depreciation, and business interest deductions – offering valuable tax benefits to equipment sellers and their customers.
- Bigger Tax Savings: The new rules let buyers deduct more of their equipment costs right away, making equipment purchases more affordable.
- Better Financing Options: By working with equipment finance lenders like Beacon Funding, sellers can help customers take advantage of both immediate tax deductions and ongoing interest savings.
- Stronger Partnerships: Dealers, lenders, and buyers all benefit from these changes, with more flexibility and clearer long-term planning.
These updates are now permanent, giving everyone in equipment finance confidence to make long-term decisions.
PARTNER WITH BEACON FUNDING
To get the most out of these benefits:
- Stay up to date on tax law changes.
- Clearly explain new advantages to your customers.
- Work with tax professionals to offer the best advice.
By being proactive, equipment sellers can become trusted partners and help their clients save money while growing their businesses.