Buy a Big, Beautiful Drill with the Big, Beautiful Bill!
By Renée Lauzon-Martin - General Manager, HDD Broker LLC - August 28, 2025
If you're a contractor based in the US eyeing a major equipment purchase this year, there's good news: the 2025 updates to Section 179 and bonus depreciation could dramatically reduce your tax bill—and put cash back in your pocket.
What Is Section 179?
Section 179 allows you to deduct the full purchase price of qualifying equipment in the year it's placed into service, rather than depreciating it over several years. This means you get immediate tax relief, which can be a game-changer for cash flow.
What's New in 2025?
Thanks to the One Big Beautiful Bill Act (OBBBA), the limits for Section 179 have been significantly increased:
- Deduction Limit: Raised to $2.5 million (up from $1.25 million) 1.
- Phase-Out Threshold: Begins at $4 million in equipment purchases (up from $3.13 million) 1.
- Bonus Depreciation: Restored to 100% for qualifying assets placed in service after January 19, 2025 2.
This means you can deduct up to $2.5 million in equipment purchases immediately, and if your spending exceeds that, you can still use bonus depreciation to write off the rest.
Both new and used equipment qualifies!
Real-World Example (as calculated at section179.org)
Let's say you're buying a $250,000 HDD rig:
- Section 179 Deduction: $250,000
- Tax Savings (at 35% rate): $87,500
- Lowered Cost of Equipment (after Tax Savings): $162,500
That's real money you can reinvest into your business.
Strategy Tips
- Buy Early: Equipment must be placed in service by December 31, 2025.
- Bundle Purchases: Combine smaller items with larger ones to maximize deductions.
- Use Financing: You can still claim deductions even if you finance the equipment.
- Keep Records: Save invoices, delivery receipts, and installation dates.
Final Thoughts
If you're planning to invest in equipment this year, 2025 is the time to do it. With expanded Section 179 limits and the return of 100% bonus depreciation, you can dramatically reduce your taxable income and improve your bottom line.
Before making a purchase, talk to your tax advisor to ensure you're maximizing these benefits. But don't wait too long—these deductions only apply to equipment placed in service before year-end.
Ready to buy? Take a look at our tremendous selection of equipment or call us today!
This commentary is presented for informational purposes only. It is not intended to be a comprehensive or detailed statement on any subject and no representations or warranties, express or implied, are made as to its accuracy, timeliness or completeness. Nothing in this commentary is intended to provide financial, legal, accounting or tax advice nor should it be relied upon. Neither HDD Broker LLC nor the author is liable whatsoever for any loss or damage caused by, or resulting from, any use of or any inaccuracies, errors or omissions in the information provided.