Section 179
Section 179 is a US tax provision allowing a business to deduct the cost of qualifying equipment in the year it is placed in service, rather than depreciating it over several years.
Last reviewed · by the Fleetchart team
For a carrier this can apply to trucks, trailers and certain equipment, subject to annual limits and eligibility rules that change over time.
Taking the deduction early reduces taxable income now but removes the depreciation that would have offset income in later years, so it is a timing decision rather than a free reduction.
It interacts with financing structure and with how the entity is taxed. This is general information, not tax advice — confirm with a professional before making an equipment decision on tax grounds.
For example, say a carrier buys a truck for $90,000 and has $100,000 of profit that year before counting the truck. If the full cost is deducted in year one, taxable profit drops to $100,000 − $90,000 = $10,000. If the cost were spread out instead, say a made-up even split of $18,000 a year over five years, taxable profit this year would be $100,000 − $18,000 = $82,000, and each later year would still get an $18,000 deduction.
This matters for cash flow. If the truck is financed, you still make payments in later years with no deduction left to set against the profit.