Section 179 vs Bonus Depreciation: What Freelancers Should Pick

You just spent $4,000 on a new laptop, a real camera, and a desk instead of the kitchen table. Your tax software asks if you want to expense it now or spread it out, shows you a savings number, and moves to the next screen. Most freelancers click whatever gives the bigger number this year and never think about the question again.

That click matters more than it looks like it does. Three different IRS rules can apply to the same equipment purchase, and each one changes how much tax you owe this year versus next year. Pick the wrong one, and you still get the deduction, just in a year when it's worth less to you.

1.What Counts as Equipment You Can Write Off

The IRS calls it tangible property: anything physical you buy for the business that will last more than a year. A laptop counts. So does a camera, a monitor, a printer, an office chair, even the desk under your keyboard right now. One rule covers everything on that list: you have to use it more than half the time for business, or none of the three methods below apply to it at all.

Mixed-use items get prorated. Buy a laptop and use it 80% for client work and 20% for personal browsing, and only 80% of the cost is eligible for any write-off. Keep a rough log of the split for the first year you own it. The IRS doesn't need a stopwatch, but it does expect a number you can defend if it ever asks.

• Computers and monitors. A MacBook Air, a Dell UltraSharp monitor, a portable SSD backup drive. Five-year property under IRS rules.
• Cameras and audio gear. A Sony a6700 body, a Rode wireless mic, a ring light for client calls. Also five-year property.
• Office furniture. A standing desk, a real office chair, a filing cabinet. Seven-year property, a longer schedule than electronics.
• Software you buy outright. A one-time Adobe Lightroom license, not the monthly Creative Cloud plan. Off-the-shelf software qualifies too.

2.The $2,500 Rule That Skips the Whole Debate

Check the price tag before you touch Section 179 or bonus depreciation. The IRS has a separate rule called the de minimis safe harbor: a way to deduct the full cost of a cheap item right away instead of spreading it out. If a single item costs $2,500 or less, you deduct the whole thing the year you buy it, no depreciation schedule, no Form 4562. Treasury Regulation 1.263(a)-1(f) set that $2,500 line in 2015, and it still stands in 2026.

Most of what a freelancer buys falls under that line. A $900 laptop, a $400 camera, a $150 monitor: all of it goes straight onto Schedule C as a regular supply expense, the same line as printer paper and a box of pens. You never touch depreciation.

3.Section 179: The Deduction You Elect Into

Section 179 lets you write off the full cost of equipment over $2,500 in the year you buy it, instead of spreading the cost across its useful life. For 2026, the cap is $2.56 million, and the write-off shrinks dollar for dollar once total equipment purchases for the year pass $4.09 million. No freelancer is getting near either number.

The taxable income limit is what should worry you instead. Section 179 can't push your business profit below zero. Net $18,000 before the deduction and buy a $22,000 setup, and Section 179 only covers $18,000 this year. The remaining $4,000 carries forward, waiting for a year when you have income to use it against.

4.Bonus Depreciation: The Default You'd Have to Turn Down

Bonus depreciation used to phase down every year, from 100% toward 80%, 60%, and lower until it disappeared entirely. The One Big Beautiful Bill Act reset that in 2025. Equipment placed in service after January 19, 2025 gets 100% bonus depreciation again, and this time the rate is permanent instead of scheduled to fade.

Bonus depreciation applies automatically. You don't elect into it the way you elect into Section 179; it happens on its own unless you file a statement electing out, one asset class at a time. It can also push your business income below zero, something Section 179 can't do, and that loss can offset other income or carry forward to a year with more of it.

5.Why Spreading It Out Over Five Years Can Still Win

Full write-off now looks like the obvious choice, and most years it is. It stops being obvious the year your income is unusually low and next year's isn't. IRS Publication 946 sets out a standard depreciation schedule for equipment that skips Section 179 and bonus depreciation entirely, called MACRS (Modified Accelerated Cost Recovery System). For five-year property like a laptop or camera, the percentages look like this:

A freelancer buys a $4,000 camera setup in a year netting $9,000 in profit, comfortably in the 12% bracket. Full write-off now under Section 179 or bonus depreciation saves $480 in tax this year: $4,000 times 12%. She elects out instead and uses the MACRS schedule above. This year's 20% slice, $800, is only worth $96 at 12%. But a signed retainer pushes every year after this one into the 22% bracket. The remaining $3,200 of basis, spread across years two through six, is worth $704 in tax savings at that higher rate. Add it up: $96 plus $704 is $800 total, against $480 for writing it all off now. Same $4,000 camera, $320 more in her pocket, just from picking which years to claim it in.

A dollar of deduction is worth your tax bracket in the year you claim it. Which year that is should be your choice, not your software's default.

Run the math both ways before you file, not after. Once you make the Section 179 election or accept bonus depreciation for an asset class, undoing it means amending a return, not just changing your mind next April.

Leo Mattersdorf, the accountant who prepared Albert Einstein's tax returns, recalled him saying over lunch: "The hardest thing in the world to understand is the income tax." Einstein was talking about a tax code far shorter than the one freelancers deal with now. Three separate write-off options for one laptop purchase is that same complexity, scaled down to a single line on Schedule C.

All three choices are legitimate. The safe harbor clears out most of what you buy without a form. Section 179 and bonus depreciation clear out the rest in one shot, which is right most years. MACRS is the slow lane you keep open for the year your income doesn't match the calendar. If you want to see whether this year is actually one of your low ones before you decide, the free profit audit at simplance.org/profit-audit runs the numbers in about a minute.