By Chris Santy, Managing Director & President, Patriot Capital Corporation

What Changed under the One Big Beautiful Bill Act?

2026 Update: Updated for the 2026 tax year. Section 179 limits and bonus depreciation rates are confirmed below.

• The most significant change to Section 179 in nearly a decade happened on July 4, 2025, when the One Big Beautiful Bill Act (OBBBA) was signed into law. For convenience store operators and fuel retailers, the impact is substantial: the annual Section 179 deduction limit more than doubled — from $1.22 million in 2024 to $2.5 million starting in 2025 — and 100% bonus depreciation was permanently restored. Both 2025 and 2026 operate under this same law, with the 2026 figures slightly higher due to inflation indexing. This article explains exactly what changed, what it means for your store’s equipment purchases, and how to take advantage of both tools — Section 179 expensing and bonus depreciation — before year-end. If you have questions about financing equipment to maximize these deductions, Patriot Capital’s team is here to help.

Key Numbers at a Glance: 2024 vs. 2025/2026

What Did the One Big Beautiful Bill Act Change for Section 179?

Before the OBBBA, Section 179 limits were set under the 2017 Tax Cuts and Jobs Act (TCJA). For 2024, convenience store operators could deduct up to $1.22 million of qualifying equipment purchased and placed in service during the year. Once total purchases exceeded $3.05 million, that deduction phased out dollar-for-dollar.

The OBBBA made two major changes, both effective for tax years beginning after December 31, 2024:

• Maximum deduction raised from $1.22 million to $2.5 million. This is a 105% increase — more than double the prior limit.
• Phaseout threshold raised from $3.05 million to $4.0 million. Larger operators with bigger capital budgets can now deduct far more before the benefit begins to reduce.
• Both amounts are indexed for inflation. For 2026, the inflation-adjusted figures are $2.56 million (deduction) and $4.09 million (phaseout)

⚠ Note: These changes apply to tax years beginning after December 31, 2024. That means both your 2025 and 2026 tax returns benefit from the same OBBBA-level limits. Nothing changed between 2025 and 2026 except normal inflation adjustment. Always consult your tax advisor for guidance specific to your situation.

What Happened to Bonus Depreciation?

Bonus depreciation is a separate but related tool. Under the TCJA, 100% bonus depreciation was always temporary — it was scheduled to phase down from 100% to 0% between 2023 and 2027. By 2024, it had already dropped to 60%. Without action, it would have fallen to 40% in 2025, 20% in 2026, and disappeared entirely by 2027.

The OBBBA reversed that entirely. For qualified property acquired and placed in service after January 19, 2025, 100% bonus depreciation is permanently restored. This is not a temporary fix — it is a permanent change to the tax code.

One important detail: the cutoff is the acquisition date, not the delivery date. If you signed a binding contract before January 19, 2025, that equipment is subject to TCJA phase-down rates even if delivered later. Equipment contracted on or after January 20, 2025, qualifies for 100% bonus depreciation.

Section 179 vs. Bonus Depreciation: Which Should Your Store Use?

Both tools allow immediate expensing of equipment. But they work differently, and for most convenience stores, the right answer is to use both strategically:

Strategy tip: Apply Section 179 first to assets that wouldn’t qualify for bonus depreciation (like certain building improvements). Then apply bonus depreciation to the remaining qualified assets for full first-year expensing. Work with your CPA to model both scenarios for your specific situation.

What Convenience Store Equipment Qualifies in 2025 and 2026?

Both Section 179 and bonus depreciation apply to a wide range of c-store capital investments. Here is a practical guide to common qualifying assets:

Eligible for Both Section 179 and Bonus Depreciation

• Fuel dispensers and pump upgrades (including Gilbarco Veeder-Root dispensers)
• POS systems and payment technology
• Refrigeration units and walk-in coolers
• Beverage equipment (coffee systems, fountain drinks, frozen beverages)
• Food service equipment (hot cases, fryers, ovens)
• LED canopy lighting and interior lighting systems
• Surveillance and security camera systems
• Digital signage
• Beer caves
• Car wash equipment
• Underground storage tanks (USTs)

Eligible for Section 179, but Not Always Bonus Depreciation

• Roofing improvements (qualified improvement property — verify with CPA)
• HVAC systems (qualified improvement property)
• Fire protection and alarm systems
• Certain structural improvements to non-residential buildings

Key Eligibility Rules

• Equipment must be placed in service before the end of the tax year to qualify.
• Must be used more than 50% for business purposes.
• For bonus depreciation, acquisition date must be after January 19, 2025.
• New and used equipment both qualify, provided the property is new to your business.

⚠ Note: Patriot Capital does not provide tax or legal advice. This article is for informational purposes only. Consult your tax advisor before making financing or deduction decisions.

How These Changes Affect C-Store Equipment Financing?

Higher deduction limits don’t just reduce your tax bill — they change the economics of financing. When you can deduct $2.56 million of equipment cost in the first year, the after-tax cost of a financed equipment purchase drops significantly. For many c-store operators, this makes 2026 an unusually compelling window to upgrade dispensers, refrigeration, POS systems, and other capital equipment.

Patriot Capital specializes in convenience store equipment financing and fueling equipment financing — including gas pump financing, LED lighting financing, underground storage tank financing, and POS system financing. Our Section 179 tax savings calculator can help you estimate your potential deduction before you commit to a purchase.

Why Timing Still Matters: Don’t Wait Until December?

Equipment must be installed and operational — placed in service — before the end of your tax year to claim the deduction. This is easy to overlook, but late-year equipment orders routinely miss the window due to:

• Shipping delays from manufacturers
• Contractor and installer scheduling backlogs
• Permit processing timelines
• Equipment inventory shortages

For fuel dispensers in particular, installation requires site preparation, permits, and certified installers — processes that can take weeks. C-store operators who plan equipment upgrades in Q1 or Q2 have far more flexibility than those scrambling in November.

Frequently Asked Questions

What is the Section 179 deduction limit for 2026?

The 2026 Section 179 deduction limit is $2.56 million, inflation-adjusted from the $2.5 million base established by the One Big Beautiful Bill Act. The phaseout threshold is $4.09 million for 2026.

What changed between 2025 and 2026?

Nothing changed legislatively between 2025 and 2026. Both years operate under the OBBBA signed July 4, 2025. The only difference is a minor inflation adjustment: 2025 base limits are $2.5M deduction / $4.0M phaseout; 2026 figures are $2.56M / $4.09M after indexing.

What changed vs. 2024?

2024 was the last year under the prior TCJA limits: $1.22 million deduction cap with phaseout beginning at $3.05 million, and 60% bonus depreciation. The OBBBA more than doubled both Section 179 thresholds and permanently restored 100% bonus depreciation starting in tax year 2025.

Do I have to choose between Section 179 and bonus depreciation?

No — you can use both on the same asset. The standard strategy is to apply Section 179 first (especially to assets not eligible for bonus depreciation like certain building improvements), then apply 100% bonus depreciation to any remaining qualified property. Your CPA can model the optimal combination for your income level and business structure.

Does financed equipment still qualify?

Yes. Equipment purchased through financing or leasing can still qualify for Section 179 and bonus depreciation, as long as it is placed in service before year-end and meets other eligibility requirements. This is one reason financing makes strong sense in 2025 and 2026 — you can take the full deduction now while preserving cash flow through a structured payment plan.

Ready to Upgrade Your Store Before Year-End?

Patriot Capital is the nation’s leading equipment financing company for convenience stores and fuel retailers — and the exclusively endorsed finance partner of Gilbarco Veeder-Root. Use our Section 179 calculator to estimate your deduction, or get a quick financing quote from your regional Patriot Capital advisor today.

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