Thinking about upgrading your equipment or facilities? 2025 is the year to do it. Thanks to major updates to Section 179 of the U.S. tax code — and the return of 100% bonus depreciation — you can deduct more of your investment right away, improve cash flow, and modernize your operations without waiting years to recover costs through traditional depreciation.
Whether you’re considering a Fluid-Aire compressed air system, nitrogen generator, air dryer or other facility upgrades, these changes give you more purchasing power, more flexibility and more reasons to invest now.
What Is Section 179?
Section 179 of the U.S. tax code is a business tax deduction that lets you write off the full purchase price of qualifying equipment in the year you buy and put it into use, rather than depreciating it over several years. This deduction applies in the year the property is placed in service.
Qualified property typically includes:
- Tangible personal property such as machinery, equipment, office furniture and off-the-shelf computer software.
- Certain improvements to nonresidential real property, including roofing, HVAC, fire protection and security systems.
- Vehicles used predominantly for business (subject to limits).
For companies considering upgrades like Fluid-Aire compressed air systems, nitrogen generators, compressed air dryers or facility improvements, the enhanced Section 179 limits mean you can deduct more of your investment right away — without waiting years to recover the cost through traditional depreciation.
What’s New with Section 179 in 2025
On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law, delivering a large expansion to Section 179. This update gives business owners more purchasing power, more flexibility and more reasons to invest in the equipment and infrastructure that will drive their operations forward. Combined with the return of 100% bonus depreciation, these changes create an opportunity to modernize your operations while reducing your 2025 tax liability.
Key updates include:
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Higher deduction limit: You can now deduct up to $2.5 million of qualifying property in the year it’s placed in service (up from $1.25 million).
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Increased phase-out threshold: The deduction now begins to phase out when total Section 179 purchases exceed $4 million and disappears entirely at $6.5 million.
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Inflation adjustment: Both the deduction and phase-out limits will be indexed for inflation after 2025.
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Retroactive effect: Changes apply to qualifying property placed in service on or after January 1, 2025.
Bonus depreciation is back: OBBBA permanently restored 100% bonus depreciation for qualifying assets placed in service on or after January 19, 2025. Businesses can apply the Section 179 deduction first, then bonus depreciation to the remainder, allowing for 100% first-year expensing. (Bonus depreciation does not cover facility improvements such as roofs, HVAC, fire suppression and security systems.)
When you combine Section 179 with 100% bonus depreciation, you can often deduct the entire cost of new capital purchases — such as a full Fluid-Aire compressed air system — in the same tax year. This powerful combination not only lowers taxable income but also improves cash flow, freeing up capital for additional investments, hiring or facility upgrades.
Section 179 for Compressed Air & Nitrogen Equipment
The expanded Section 179 deduction in 2025 applies to a wide range of industrial equipment, making it the perfect time to invest in upgrading your compressed air or nitrogen generation systems. If the equipment is purchased and placed in service by December 31, 2025, you can deduct the full purchase price in the same tax year, dramatically improving your cash flow.
For Fluid-Aire customers, qualifying purchases can include:
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Complete compressed air systems: Rotary screw compressors, piston compressors, variable speed drive (VSD) units, and oil-free compressors.
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Nitrogen generators: On-site nitrogen generation systems to reduce dependence on costly delivered gas.
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Air treatment & drying equipment: Refrigerated and desiccant air dryers, membrane dryers and integrated dryer packages.
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Filtration systems: Inline particulate, coalescing and activated carbon filters to ensure clean, contaminant-free air.
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Air system accessories: Zero-loss condensate drains, air receivers, flow controllers and pressure/flow monitoring equipment.
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Facility upgrades: Piping systems and other related improvements to support your air or nitrogen system (including certain building modifications covered under Section 179, such as HVAC or electrical upgrades tied to equipment installation).
Reasons to Buy Before Year-End
If your business is planning to invest in industrial equipment, compressed air systems, nitrogen generators or other manufacturing machinery, the final months of the year are the most strategic time to act. The 2025 updates to Section 179 and the return of 100% bonus depreciation create an unprecedented opportunity to reduce your taxable income, boost cash flow and upgrade to the latest Fluid-Aire equipment before January 1.
Acting now not only locks in these enhanced deductions but also ensures your new equipment is installed and operational before supply chain slowdowns or vendor backlogs impact your schedule.
Top reasons to buy before year-end:
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Maximize 2025 deductions: The expanded $2.5 million limit and restored 100% bonus depreciation provide unprecedented upfront tax savings.
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Improve cash flow immediately: Keeping more money in your business means more flexibility for reinvestment, hiring or expansion.
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Avoid supply chain delays: Qualifying assets must be purchased and placed in service by December 31, 2025. Plan ahead to meet the deadline.
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Upgrade while saving: Use the deduction to offset the cost of replacing outdated equipment, expanding production or improving facilities.
Don’t Overlook Energy Incentives!
If your purchase includes energy-saving improvements — such as upgrading to a variable speed drive (VSD) compressor, installing zero-loss drains or adding smart monitoring systems — your local utility may help cover the cost through their energy incentive programs. These rebates can often be used in addition to your Section 179 tax deduction, giving you two powerful ways to reduce your costs. It’s worth checking with your power company before you buy to see what’s available and how to qualify.
Fluid-Aire Dynamics can help you find energy incentives in your area and even fill out the paperwork for you!
Upgrade Smart. Save Big.
Fluid-Aire Dynamics offers best-in-class compressed air and nitrogen equipment, backed by experienced system designers who can help you assess your needs and find the perfect solution. Upgrading from an existing system? Ask us about a data logging study to identify opportunities for efficiency and performance gains.
Key takeaway: The 2025 updates to Section 179 create a powerful incentive to invest in capital equipment now. By acting before year-end, you can lock in significant tax savings, strengthen your operations and position your business for growth in the year ahead.
Consult your tax advisor to determine the most strategic way to leverage these new provisions for your specific situation.
