- Buying Process
- How To
This article is for general educational purposes only and should not be considered professional tax advice. For the most current Section 179 limits and requirements, visit IRS.gov or consult with your tax advisor.
Buying a trailer for your business doesn’t just help you get work done - it can also help you save a lot of money when tax season comes around. The IRS offers a rule called Section 179 that lets business owners deduct most (or even all) of the cost of a new trailer in the same year it’s purchased.
Here’s how it works:
What Is Section 179?
Normally, when you buy equipment for your business, you’re only allowed to deduct a small part of the cost each year over several years. This is called depreciation. Depreciation is essentially the government saying, “We know your equipment loses value as you use it, so we’ll let you deduct that loss as a business expense.”
Section 179 changes the way we account for depreciation. Instead of slowly getting deductions each year for the next five years, it lets you deduct the entire cost of qualifying equipment - like a new trailer - all at once in the year that you bought it, given that you meet a few criteria.
This helps lower your taxable income right away, which means you keep more of your money today instead of waiting years for the tax benefits to add up.
Who Can Use Section 179?
You may be able to use this tax deduction if:
✅ You use the trailer more than 50% for business.
If you use it mainly for work like hauling equipment, making deliveries, or running job sites, it usually qualifies. The IRS lets you deduct the portion of the cost that matches your business-use percentage. So if you use a trailer half the time for landscaping jobs and half for personal weekend use, you can deduct 50% of the purchase price. Use it entirely for business? Then you can deduct the full cost!
*Note - if the equipment is not used for business at least 50% of the time, then none of it can be deducted as a business expense.
✅ You buy and use the trailer in the same year.
It must be “placed into service,” meaning the trailer is ready to use for your business.
✅ You stay under the annual limit.
Under new tax law for 2025, businesses can deduct up to $2.5 Million worth of equipment using Section 179.
Example: How Much You Could Save
Let’s say a developing landscaping business buys:
- A dump trailer for $8,500
- A cargo trailer for $6,500
Total: $15,000
And both trailers are used 100% for business.
Option 1: Use Section 179
The business can deduct the full $15,000 from its taxable income this year. If you’re in a 22% tax bracket, then you just saved $3,300 in taxes this year, but will not take any further deductions in the coming years.
This means more cash available now for:
- Hiring
- Supplies
- Fuel
- Other expenses
Option 2: Don’t Use Section 179
Alternatively, if the business doesn’t use Section 179, the IRS would spread the deduction out over several years. There are different methods for doing this - the “MACRS” method and the “Straight Line” method.
If the trailers depreciate over 5 years using straight line depreciation, you’d deduct $3,000 per year for the next 5 years. Again, if you’re in the 22% tax bracket, that would mean you save $660 in taxes this year and every year for the next 5 years.
- You won’t get the full tax benefit upfront
- Less immediate cash flow
Notice that the total deduction over 5 years is still $3,300, however Section 179 allows you to claim this money upfront, instead of waiting for 5 years. Most small businesses prefer Section 179 because it puts the most money back in your hands now.
Why Section 179 Matters
Choosing to use this deduction can help you:
- Keep more cash in your business today
- Recover the cost of your trailer faster
- Free up money to grow, invest, or operate more comfortably
- Reduce the financial pressure of buying new equipment
Whether you’re upgrading, expanding, or just getting started, Section 179 can make purchasing a trailer a much easier financial decision. This is not some loophole that’s getting exploited or a sneaky tax evasion scheme. The reality is that the government wants businesses to reinvest, grow, and buy equipment. Section 179 is a way to reward businesses for investing in themselves now instead of later.
A Quick Reminder
This article is for general guidance only. Everyone’s tax situation is different. To make sure you’re getting the most benefit and following the rules correctly please speak with a qualified tax professional. Interstate Group, LLC makes no warranties about the accuracy, completeness, or timeliness of this information and assumes no liability for any decisions made based on this content.
Ready to Take Advantage of Section 179?
Shop new trailers and put those tax savings to work for your business.
