When you run across terms like ‘Section 179’ in the U.S. tax code, it’s easy to feel like you’re lost in a maze of rules only tax professionals can understand.
But Section 179 is surprisingly straightforward. It’s also valuable for small to medium-sized businesses looking to benefit from tax savings on equipment or software that will improve their business.
In this article, we’re digging into Section 179. We’ll explain how it works and how it can help you upgrade your tech next year and beyond.
What is Section 179—and why should you care?
Section 179 allows businesses to deduct the full purchase price of qualifying equipment or software in the year it’s purchased or financed, rather than depreciating it over several years.
What does this mean for you? Instead of gradually depreciating a $20,000 equipment purchase over five years at $4,000 per year, you can deduct the full purchase price the year you buy it—up to $1,220,000 for the 2024 tax year.
Capturing that immediate deduction helps businesses that want to invest in productivity-boosting upgrades without stretching their cash flow too far.
For construction industry decision-makers who recognize the value of capturing and sharing high-accuracy project data, Section 179 can offer a compelling opportunity to invest in more advanced site mapping technology, driving better project outcomes and keeping you competitive.
Who can use Section 179?
Full disclosure before we go any further: We aren’t tax professionals, so it’s always best to talk to your tax pro before making any major financial decisions.
That said, Section 179 comes with a few basic requirements to know about:
- Business use: In-scope equipment must be used for business purposes more than 50% of the time.
- Qualifying purchases: Tangible property, off-the-shelf software, and even some vehicles are eligible for the Section 179 deduction. This includes both drones and the software that turns aerial data into 3D maps.
- Year-end deadline: To qualify for a 2024 tax year deduction, equipment and software must be purchased and in use by December 31, 2024.
Why make your Section 179 purchases now?
As the end of the year approaches, Section 179 becomes particularly strategic for a few key reasons:
- Immediate tax savings: You can buy something you want and make a dent in your upcoming tax bill. Rather than waiting years to recoup your costs through depreciation, purchases you make now can significantly reduce your upcoming tax burden.
- Seasonal slowdown: Winter tends to be a slower season for construction, making it an ideal time to test, implement, and train users on new technology. Getting an early start and capturing winter “downtime” helps set the stage for a seamless transition when projects pick back up again in spring.
- Future-proof your survey workflows: Investing in your Propeller program now positions you for better efficiency, precision, and data accessibility next year (and beyond). Optimized geospatial workflows impact more than the survey department—they have a ripple effect on project planning, decision-making, and on-site safety, streamlining operations and reducing project timelines.
How Propeller can help
Propeller’s platform empowers your team to map, measure, and manage worksites with ease and efficiency. Gain critical insights into topography, material volumes, safety hazards, water runoff patterns, and more. Our solutions seamlessly integrate with your existing workflows, ensuring an accessible and effective survey and mapping process from day one.
For contractors ready to invest in drone survey technology, now is an ideal time to capitalize on year-end tax deductions and kick off a program that will pay dividends in operational efficiency for years to come.
