Section 179 Deduction for Medical Practice Owners: Write Off Equipment Purchases This Year

By Brian Giesecke, CPA/EA | Giesecke Advisory

Buying equipment for your medical practice this year?

There's a way to deduct the full cost — this year — instead of spreading it over many years.

It's called Section 179 (named after IRC Section 179), and it lets practice owners expense qualifying equipment purchases immediately rather than depreciating them over 5-7 years. If you're not using it strategically, you're missing out.

What Is the Section 179 Deduction?

Normally, when you buy equipment, you depreciate it over time. A $50,000 piece of equipment might be depreciated over 5-7 years using MACRS depreciation.

Section 179 changes that. You can deduct the full cost of qualifying equipment in the year you buy and place it in service.

That $50,000 piece of equipment? Deduct all $50,000 this year.

The Section 179 deduction limit for 2024 is $1,220,000, with a phase-out threshold beginning at $3,050,000 in total equipment purchases. Unless you're buying a building's worth of equipment, you're unlikely to hit the cap. (These limits are adjusted annually for inflation.)

What Equipment Qualifies for Section 179?

Most tangible property used in your practice:

• Medical equipment (lasers, imaging devices, treatment equipment)
• Office furniture
• Computers and technology
• Software
• Vehicles (subject to luxury auto limits under IRC Section 280F — SUVs over 6,000 lbs GVWR have a separate $28,900 cap for 2024)

What doesn't qualify:

• Buildings and structural improvements
• Property used less than 50% for business

How Should Medical Practice Owners Use Section 179 Strategically?

Section 179 is a tax planning tool. You control when you take the deduction by controlling when you buy.

Scenario: It's November. You're looking at a higher-than-expected tax bill. You've been thinking about new equipment.

Buy it before December 31st? Full deduction this year. Immediate tax savings.

Wait until January? Deduction goes on next year's return.

This is why year-end planning conversations matter.

Important note on bonus depreciation: Bonus depreciation (IRC Section 168(k)) is a related but separate provision. For 2024, bonus depreciation is at 60% (it's phasing down 20% per year from the 100% level under the Tax Cuts and Jobs Act). Section 179 has no phase-down — the full deduction remains available. For most medical practices, Section 179 alone covers what you need.

Caution: Don't buy equipment just for the deduction. Buy what you actually need. The deduction is a benefit, not the primary reason.

Key Takeaways

• The 2024 Section 179 deduction limit is $1,220,000 — more than enough for virtually any medical practice equipment purchase
• Equipment must be purchased AND placed in service by December 31st to qualify for the current tax year
• Section 179 is an election, not automatic — you must claim it on IRS Form 4562 (Depreciation and Amortization) filed with your return
• Bonus depreciation is phasing down (60% in 2024, 40% in 2025, 20% in 2026) — but Section 179 remains fully available with no phase-down
• The deduction cannot exceed your business's taxable income for the year — unused amounts carry forward to future years

FAQ

What's the difference between Section 179 and bonus depreciation? Section 179 is an election you make to expense specific assets, capped at $1,220,000 (2024), and limited to your business's taxable income. Bonus depreciation applies automatically to all qualifying assets with no income limit, but it's phasing down from 100% to 0% between 2023 and 2027. For most medical practices buying under $1M in equipment, Section 179 is the simpler and more reliable tool.

Can I use Section 179 on used (pre-owned) equipment? Yes. Unlike the original bonus depreciation rules, Section 179 has always allowed used equipment — as long as it's new to your business and used more than 50% for business purposes.

Your Next Step

Any equipment purchases you've been considering?

If you're expecting a strong year, it might make sense to accelerate them before December 31st.

Talk to your accountant about the math.