100% Bonus Depreciation Is Back: A Tax Benefit for Businesses Buying Office Technology and Software

The One Big Beautiful Bill Act (H.R. 1), also known as OBBBA, permanently reinstated 100% bonus depreciation for new and used property acquired and placed in service after January 19, 2025. This enables businesses to deduct the full purchase cost of most office technology and equipment in the year they are placed in service, rather than depreciating over several years.

This means that companies modernizing office technology, such as IT upgrades and new or used office equipment, can significantly reduce federal taxable income and tax liability in the year they purchase.

What Qualifies for 100% Bonus Depreciation?

• Computer Hardware: computers, tablets, routers, switches, and servers.
• Security & Access Control: network surveillance and managed IT infrastructure.
• Office & Remote Work Tools: video conferencing systems, VoIP and UCaaS systems, digital whiteboards and AV equipment.
• Business-Critical Software: ERP (NetSuite, SAP, Oracle) and CRM.
• Office Technology: Printers, copiers, and customer relationship systems.
• Cybersecurity: EDR tools, firewalls, and encryption systems.
• Data Infrastructure: backup and disaster recovery systems and data storage.

The deduction also applies to used property, so long as it is new to the business, providing flexibility for companies considering used or refurbished equipment.

An Example

Tennessee Products Inc. purchases $200,000 worth of network hardware, security software, and printers in October 2025. Under OBBBA:

• Federal Treatment: They can deduct the full $200,000 in 2025 thanks to 100% bonus depreciation, lowering taxable income and reducing their federal tax liability.
• State Considerations: Tennessee may initially limit bonus depreciation to 40% for excise tax purposes, but state laws are expected to evolve. Businesses should consult their tax advisors to maximize savings.

Key Takeaways

OBBBA enables businesses to upgrade faster, preserve cash flow, and gain tax advantages when investing in business equipment or technology for growth and competition.

• If you’ve been holding off on purchases for IT, cybersecurity, or office equipment investments, 2025 is your year.
• Each state has its own rules and timing can boost your tax savings, so consult your tax professional. 

Ready to upgrade your equipment? Contact us to talk about possible technology purchases that qualify.

About RJ Young

RJ Young is a leading provider of managed IT services, office technology solutions, and workplace automation. With a mission to empower businesses to achieve their goals, RJ Young delivers tailored solutions that drive efficiency, innovation, and customer success. For over 70 years, RJ Young has been helping organizations across the Southeast navigate the ever-changing landscape of technology.