Section 179 and 100% Bonus Depreciation in 2026: Trucks and Equipment
Section 179 allows up to $2,560,000 for 2026 and 100% bonus depreciation is back for property acquired after January 19, 2025. Limits for SUVs and rentals.
By Seayora Editorial Team · Published · Facts checked · 3 min read
Short answer: For tax years beginning in 2026, a business can expense up to $2,560,000 of section 179 property, reduced dollar for dollar once purchases exceed $4,090,000, and an SUV’s section 179 amount is capped at $32,000. Separately, the 2025 tax law made 100% bonus depreciation permanent for qualified property acquired and placed in service after January 19, 2025. Property under a written binding contract signed earlier is treated as acquired then. Landlords should note that property used predominantly to furnish lodging generally cannot be section 179 property.
Key takeaways
- 2026 section 179 limit: $2,560,000, phasing out above $4,090,000 of purchases (Rev. Proc. 2025-32).
- SUVs: no more than $32,000 may be expensed under section 179 in 2026.
- 100% bonus depreciation applies to qualified property acquired after January 19, 2025, with no dollar cap.
- A binding contract signed before January 20, 2025 means the old phase-down applies.
What are the 2026 section 179 limits?
For taxable years beginning in 2026, the aggregate cost of section 179 property a taxpayer may elect to expense cannot exceed $2,560,000, and that limit is reduced, but not below zero, by the amount by which the cost of section 179 property placed in service during the year exceeds $4,090,000. The cost of a sport utility vehicle that may be taken into account under section 179 cannot exceed $32,000 (Rev. Proc. 2025-32). For 2025 the figures were $2,500,000 and $4,000,000 (Form 4562 instructions).
| Tax year beginning in | Maximum deduction | Phase-out begins at | SUV cap |
|---|---|---|---|
| 2025 | $2,500,000 | $4,000,000 | $31,300 |
| 2026 | $2,560,000 | $4,090,000 | $32,000 |
Is bonus depreciation 100% again?
Yes, for property acquired after January 19, 2025. Section 70301 of the 2025 tax law (Public Law 119-21) replaced the annual phase-down with a permanent 100% additional first-year depreciation deduction for qualified property acquired and placed in service after that date. Property is not treated as acquired after the date a written binding contract for it was entered into, so equipment ordered under a binding contract signed before January 20, 2025 stays under the old schedule, which was 40% for most property placed in service in 2025. For the first tax year ending after January 19, 2025, a taxpayer may elect 40% instead of 100% (IRS Notice 2026-11).
Section 179 or bonus depreciation for a work truck?
- Section 179 is an election, item by item, limited by the dollar caps above and by business income; bonus depreciation has no dollar cap.
- Section 179 property must be used more than 50% in the business, and the deduction is recaptured if business use later drops to 50% or less.
- Heavy SUVs are capped at $32,000 under section 179 for 2026; the rest of the cost can still be eligible for bonus depreciation.
- Passenger automobiles have separate annual depreciation limits; see IRS Publication 946.
Can landlords use section 179?
Generally not for residential rental units. Property used predominantly to furnish lodging, or in connection with furnishing lodging, is generally not section 179 property, apart from the exceptions in section 50(b)(2) (IRS Publication 946). That usually rules out appliances and furniture inside apartments. Bonus depreciation is a separate deduction and does not have that limit; it can apply to rental property with a recovery period of 20 years or less, such as appliances and land improvements, but not the 27.5-year building itself. See rental property depreciation.
Frequently asked questions
What is the section 179 limit for 2026?
$2,560,000, reduced dollar for dollar once section 179 purchases placed in service in the year exceed $4,090,000 (Rev. Proc. 2025-32).
Is bonus depreciation 100% in 2026?
Yes, for qualified property acquired and placed in service after January 19, 2025. Property under a binding contract from before January 20, 2025 follows the old phase-down.
Can I take section 179 on a new pickup truck?
Generally yes if it is used more than 50% for business. Vehicles classed as SUVs are capped at $32,000 for 2026, and passenger autos have their own depreciation limits.
Sources
- Revenue Procedure 2025-32 (2026 inflation-adjusted items), Internal Revenue Service
- Instructions for Form 4562, Depreciation and Amortization, Internal Revenue Service
- Notice 2026-11, Interim guidance on the additional first year depreciation deduction under § 168(k), Internal Revenue Service
- Publication 946, How To Depreciate Property, Internal Revenue Service
How Seayora helps
Fixed assets: Record each truck and tool with its cost, in-service date and depreciation method.
This article is general information, not tax advice. Tax rules change and your situation is your own, so confirm the treatment with a CPA or enrolled agent before you file.
How we write and check these guides: editorial standards.
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