Please note this is not tax advice. Please consult your CPA or tax advisor. 

We as business owners need to square away tax planning for the current year before December 31st. If you are a business owner there is a good chance you are aware of Section 179 and / or Bonus Depreciation.

Just as a quick review, Section 179 is a mechanism by which businesses can expense against taxes 100% of capital expenditures on tools and equipment, in the year they are bought and put into service. Larger companies must typically amortize the expenditure over the useful life of the equipment. Most of the tools and equipment we sell falls into the category covered by Section 179 (notably, consumables fall outside of this but would likely be expensed anyways). 

Over the last 10 years, the maximum amount that could be depreciated through Section 179 has gradually increased; as of the date of this being written (December 2025), the maximum amount is $2,500,000. Section 197 is therefore a small business friendly tax deduction. The threshold is furthermore much higher in 2025 compared to 2024 (only around $1,250,000), due to the passing of the One Big Beautiful Bill. 

If you are holding a business in an LLC, your business expenses are going to have a meaningful impact on your personal taxes. If you are in a high tax bracket (which you likely are as a business owner) and if you live in a high tax state like California, your marginal tax rate could be more than 50%! Every expense you claim, including your investment in tools and equipment under Section 179, will net you less in taxes. 46 states conform with Section 179 which means the full amount of the equipment can also be used to offset state corporate or income taxes. 

We have written about the Return On Investment (ROI) on the equipment we sell. We believe that if you feel confident about the return on ADAS equipment (try out our ROI calculator for free), then making the investment this year is a smart way to invest from a tax planning lens.

Read more about how to use our ROI calculator.

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