07/17/2026
𝗦𝗵𝗼𝘂𝗹𝗱 𝗜 𝘂𝘀𝗲 𝗦𝗲𝗰𝘁𝗶𝗼𝗻 𝟭𝟳𝟵 𝗼𝗿 𝗕𝗼𝗻𝘂𝘀 𝗗𝗲𝗽𝗿𝗲𝗰𝗶𝗮𝘁𝗶𝗼𝗻 𝗳𝗼𝗿 𝗺𝘆 𝗯𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗲𝗾𝘂𝗶𝗽𝗺𝗲𝗻𝘁 𝗽𝘂𝗿𝗰𝗵𝗮𝘀𝗲𝘀?
One strategy is to apply Section 179 first to erase your active business income down to zero. Then, apply 100% Bonus Depreciation to any remaining asset basis if you want to strategically generate a tax loss.
Here is why: you can't use Section 179 to create a tax loss because it is strictly limited to your net business taxable income. On the flip side, 100% Bonus Depreciation doesn't care about your net income.
For example, if your net income is $100,000 and you buy a $150,000 machine:
• 𝘞𝘪𝘵𝘩 𝘚𝘦𝘤𝘵𝘪𝘰𝘯 179: You can only deduct $100,000 this year. The remaining $50,000 carries forward to next year.
• 𝘞𝘪𝘵𝘩 𝘉𝘰𝘯𝘶𝘴 𝘋𝘦𝘱𝘳𝘦𝘤𝘪𝘢𝘵𝘪𝘰𝘯: The purchase pushes your business into a $50,000 Net Operating Loss, which can potentially offset other income.
This distinction gives you more control over your tax outcome. You can decide whether it makes more sense to wipe out your current business tax bill or intentionally create a loss to offset other income.
When you look at your financial goals for this year, is your priority clearing out your active business income, or are you looking for ways to offset other income sources?
