Making Smart Tech Investments Before Year-End: Understanding Section 179 Deductions

As the year winds down, many businesses are evaluating how to make the most of their budgets especially when it comes to technology. If you’ve been putting off upgrading your IT infrastructure, computers, servers, or security systems, Section 179 of the IRS tax code could make this the ideal time to invest.

Before we go further, please note: We’re not tax advisors. This article is for informational purposes only. Always consult your CPA or tax advisor before making any decisions about your specific situation.

What Is Section 179?

Section 179 is a tax deduction that allows businesses to deduct the full purchase price of qualifying equipment and software purchased or financed during the tax year. Instead of depreciating an asset’s value over several years, businesses can write off the entire cost upfront, reducing taxable income and freeing up cash flow.

In other words, if your business buys or leases qualifying technology in 2025, you may be able to deduct 100% of that purchase this tax year (up to the annual limit).

2025 Section 179 Limits and Details

For the 2025 tax year (based on current IRS guidance):

• Deduction limit: Up to $1,250,000 in qualifying purchases.

• Spending cap: Deductions begin to phase out after $3,130,000 in total equipment purchases.

• Bonus depreciation: which applies after Section 179 limits are reached—has begun to phase down to 40 percent for most qualified property placed in service after December 31, 2024 and before January 1, 2026 (60 percent for certain long-production-period property and aircraft) 【IRS Publication 946 (2025)】.

These numbers can change, so it’s essential to verify current figures with your CPA.

What Qualifies for Section 179 (IRS)?

Most tangible business equipment qualifies, including:

• Computer hardware (servers, desktops, laptops, networking gear)

• Off-the-shelf software and licensed security tools

• IT infrastructure upgrades (firewalls, routers, backup systems)

• Office technology and equipment (phones, printers, furniture)

To qualify, the equipment must be (IRS):

• It must be property you own.
• It must be used in your business or income-producing activity.
• It must have a determinable useful life.
• It must be expected to last more than 1 year.

Why Year-End Tech Purchases Make Sense

Modern technology isn’t just an expense. It’s an investment in your company’s security, efficiency, and compliance. Leveraging Section 179 and bonus depreciation can help you:

• Lower your 2025 tax liability through immediate deductions

• Upgrade aging infrastructure before it impacts performance

• Meet cybersecurity requirements insurers and clients expect

• Stay compliant with data protection and regulatory standards

If you’ve been holding off on technology improvements due to budget constraints, the Section 179 deduction can turn those upgrades into a strategic advantage.

• If your organization is considering upgrading IT systems, cybersecurity tools, or office technology, Section 179 offers a valuable incentive to act before December 31, 2025.

  Again, we’re not accountants or attorneys so always confirm your eligibility and deduction amounts with a qualified CPA or tax professional.

• Need guidance on which technology investments make sense for your business?
  Our team can help assess your current environment and recommend solutions that strengthen your security and performance while potentially qualifying under Section 179.