Section 179 expensing allows businesses to deduct the full purchase price of qualifying property purchased or financed during the tax year, rather than capitalizing the expenses and depreciating them over several years. Consult with a tax advisor to learn more about how this can benefit your business.
Bonus depreciation is now 100% for qualifying property, meaning businesses can fully deduct the cost of eligible property in the year they are placed in service, rather than capitalizing the expenses and depreciating them over several years. (Bonus depreciation was previously set to phase down to a 40% deduction for 2025). Applicable to property acquired after January 19, 2025.
Favorable update to the deductibility of interest expense. The business interest deduction is now limited based on EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization). It used to be based on EBIT (Earnings Before Interest and Taxes).
| New Rules | Old Rules | |
| Section 179 | Deduction limit increased to $2.5m | Deduction limit was $1.25m |
| Bonus Depreciation | 100% deduction reinstated | 40% deduction |
| Business Interest Deduction | Limitation increased to be based on EBITDA | Limitation based on EBIT |
The information on this page is for general informational purposes only. The Toro Company is not providing tax advice. Consult with a tax advisor for more information.
