Bonus Depreciation 100% Is Back: Florida Equipment Tax Win 2026

If your Florida small business has been waiting on a truck, a rooftop HVAC unit, a CNC machine, or a fleet of laptops — 2026 is the year the tax code finally agrees with you. The One Big Beautiful Bill Act (OBBBA), signed July 4, 2025, did something that hasn't happened in a generation: it permanently restored 100% bonus depreciation for qualified property and made it the new normal rather than a phase-out punchline.

For business owners who follow this stuff closely, the headline is enormous. For owners who don't, here's the short version: every dollar you spend on qualifying equipment placed in service after January 19, 2025 can be written off completely in year one — no more 60% / 40% / 20% phase-down that the old TCJA timeline was set to inflict on you. The IRS released Notice 2026-11 in early 2026 to spell out exactly how the new rules work.

This post breaks down what changed, how the math works against the old phase-out, how to stack 100% bonus depreciation with Section 179 for maximum effect, and the seven-step checklist Florida owners should run before signing the next purchase order.

What Bonus Depreciation Actually Does

Section 168(k) bonus depreciation lets you immediately deduct a percentage of the cost of qualifying property in the year you place it in service, instead of spreading the deduction across five, seven, or fifteen years of MACRS depreciation. When the rate is 100%, you write off the entire cost in year one. When the rate is 40%, you deduct 40% in year one and depreciate the remaining 60% normally.

The deduction reduces taxable income dollar-for-dollar. If you're a Florida pass-through owner in the 24% federal bracket, every $100,000 of equipment expensed under bonus depreciation saves you roughly $24,000 in federal tax — in the year you write the check, not over seven years. The cash-flow swing is the entire point.

What OBBBA Changed

Under the original 2017 Tax Cuts and Jobs Act, bonus depreciation was scheduled to ratchet down on a fixed schedule: 100% through 2022, then 80% in 2023, 60% in 2024, 40% in 2025, 20% in 2026, and zero starting in 2027. Florida small businesses planning a 2026 capital purchase were staring at a 20% deduction with the rest stretched across seven years.

OBBBA permanently set the rate back to 100% for qualified property acquired and placed in service after January 19, 2025. There is no scheduled phase-down. There is no expiration date. The IRS confirmed in Notice 2026-11 that the rule applies to both new and used tangible property — including machinery, manufacturing equipment, computers, software, office furniture, and vehicles weighing under 6,000 pounds.

OBBBA also created a new Section 168(n) first-year deduction for "qualified production property" used in domestic manufacturing, agriculture, or refining — a separate elective regime designed to encourage U.S. production capacity. For most Florida service and retail businesses, Section 168(k) bonus depreciation is the relevant tool; the new Section 168(n) is a manufacturing-specific layer.

The Math: 100% vs. The 2025/2026 Phase-Down That Almost Was

The chart above shows the dollar swing on a single $250,000 capital purchase. Under the old TCJA phase-down, a 2026 buy would have generated only $50,000 of first-year bonus depreciation — the remaining $200,000 would crawl out across the asset's MACRS class life. Under OBBBA, the same $250,000 deducts in full this year. At a 24% effective rate, that is a real cash-flow difference of roughly $48,000 moved into 2026 from later years.

Section 179 Is Bigger Too — and the Two Stack

OBBBA also dialed up Section 179 expensing in parallel. Section 179 is the older, more flexible cousin of bonus depreciation — it lets you elect to immediately expense qualifying purchases up to a dollar cap, with a phase-out once your total purchases exceed a threshold. For 2026, the IRS-confirmed limits are:

Maximum Section 179 deduction — $2,560,000 of expenditures.

Phase-out begins — At $4,090,000 of total qualifying property placed in service. Above $6,650,000, the deduction is fully phased out.

Inflation indexing — Both numbers adjust annually under OBBBA, replacing the static $1M / $2.5M structure that pre-existed.

Where bonus depreciation is automatic and applies to any qualifying property, Section 179 is elective and capped — but Section 179 has two advantages that still matter. It can be used for qualified improvement property (HVAC, fire protection, roofs, security systems on non-residential buildings) that bonus depreciation historically excluded, and it can be optimized asset-by-asset. The smart move on most large purchases is to use Section 179 first up to the income limit, then layer bonus depreciation on the rest.

Section 179 vs. 100% Bonus Depreciation — Which to Use When

What Qualifies Under Section 168(k)

Notice 2026-11 reaffirmed that the property must (a) have a MACRS recovery period of 20 years or less, (b) be acquired and placed in service after January 19, 2025, and (c) not have been used by the taxpayer or a related party prior to acquisition. The most common Florida small business categories that qualify:

Vehicles under 6,000 lbs GVWR — Cars, light trucks, SUVs used for business. Subject to the luxury auto cap on the bonus piece for passenger autos (typically $20,400 first year for 2026), but heavier vehicles over 6,000 lbs avoid that cap entirely.

Heavy SUVs and trucks — Vehicles over 6,000 lbs GVWR (think work trucks, fleet vans, large SUVs used 100% for business) qualify for 100% bonus depreciation with no auto cap.

Machinery and equipment — Manufacturing equipment, restaurant kitchens, construction tools, dental and medical equipment.

Computers, software, and office equipment — Including off-the-shelf software, servers, networking gear.

Office furniture and fixtures — Desks, chairs, conference rooms, breakroom buildouts.

Qualified improvement property (QIP) — Improvements to the interior of non-residential real property placed in service after the building was first placed in service. Roofs, HVAC, fire suppression, and security systems on existing buildings can qualify under either §179 or QIP rules.

The Florida Angle

Florida has no state corporate income tax for pass-throughs and no personal income tax, so the federal benefit of bonus depreciation flows through to the owner with no state-level haircut. That puts Florida pass-through owners in a structurally better position than peers in California, New York, or Illinois — where state income tax adds back a portion of bonus depreciation, or decouples entirely. For Florida C-corps, there is a state corporate income tax to reckon with, but Florida historically conforms to federal Section 168(k) without modification (subject to legislative review each session).

Your 100% Bonus Depreciation Action Checklist

1. Inventory every 2026 capital expenditure already made or planned — Pull every invoice over $2,500 from January 1 forward, plus your Q2–Q4 capex pipeline. Anything placed in service after January 19, 2025 is potentially in scope for 100% bonus.

2. Confirm "placed in service" dates, not purchase dates — The IRS test is when the asset is ready and available for use, not when you signed the PO or paid the deposit. A piece of equipment delivered in 2025 but not commissioned until 2026 is a 2026 deduction.

3. Layer Section 179 first, then bonus — On large purchases, take Section 179 up to your taxable income limit, then 100% bonus on the remainder. Section 179 is capped by income; bonus depreciation can drive a loss.

4. Check vehicle weight before the dealer drives it home — Vehicles under 6,000 lbs GVWR are subject to the passenger auto cap. If your business case supports it, a heavier work vehicle (Sprinter van, F-250, large SUV) avoids the cap and unlocks the full deduction.

5. Run a basis-step-up analysis on used equipment — Used property qualifies for 100% bonus only if you didn't previously own or lease it. Watch for related-party purchases — they fail the test and bounce back into MACRS.

6. Model the loss-creation scenario — Bonus depreciation can push your business into a net operating loss. For pass-through owners, that NOL flows to your personal return and offsets other income (W-2, spouse's wages, investment income) up to the 80% taxable income limit. Model whether you want that or want to opt out for a specific class of property.

7. Document the §168(k) election (or non-election) on Form 4562 — Bonus depreciation is automatic. If you want to opt out for a class of property (asset class, not asset-by-asset), you must affirmatively elect on Form 4562 by the due date of the return, including extensions. Missing the election locks in 100% whether you wanted it or not.

The Bottom Line for Florida Owners

For the first time in more than 30 years, the federal tax code has handed small business owners a permanent, full-cost equipment write-off with no expiration date hovering over it. That changes the planning conversation. Capital purchases that were on hold pending "what happens to bonus depreciation" can move forward. Vehicle replacements, equipment upgrades, technology refreshes, and qualified building improvements all become more affordable in after-tax terms than they have been since the late 1980s.

The trap to avoid is sloppy execution: missing the placed-in-service date, mis-classifying a vehicle, blowing the related-party rule, or failing to coordinate Section 179 and bonus depreciation in the right order. Each of those mistakes can quietly cost five figures.

At Accounting BOSS, we model bonus depreciation, Section 179, and the new Section 168(n) production-property regime against your actual capex pipeline and your projected taxable income — and we make sure every election on Form 4562 is filed correctly the first time. If you have a 2026 equipment purchase planned, or you've already made one and want confirmation it qualifies for 100% bonus, contact us today. We'll turn the new rules into actual cash on your balance sheet.