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Tax Cuts and Jobs Act: Section 179

How new laws can benefit your building – and your bottom line.

On December 15, 2017, the unified version of the Tax Cuts and Jobs Act was put into law. Among other goals, the Tax Cuts and Jobs Act was designed to simplify tax codes, reduce the tax on wages and lower tax on business income. Section 179 of the new IRS tax code allows businesses to deduct the full purchase price of qualifying equipment from gross income.

What Is Section 179?

Section 179 of the Tax Cuts and Jobs Act of 2017 allows for qualifying HVAC products to be expensed immediately, including “heating, ventilation and air-conditioning.” This means that a system can be expensed in its first year rather than depreciated over a 39-year period. Johnson Controls, working with trade associations like the Security Industry Association and Air-Conditioning, Heating and Refrigeration Institute, helped push for the measure’s inclusion in the final bill. As a proponent of Section 179, Johnson Controls is ready to help building owners better understand and benefit from the opportunities this bill creates.

What Equipment Qualifies?

Johnson Controls can help you explore options for updating, upgrading and retrofitting your building’s systems that result in immediate, 2018 tax benefits – as well as those that create tax benefits over the course of the next five years.

  • HVAC Equipment
  • Fire Safety
  • Security and Access Control
  • Connected Lighting
  • Building Controls and Automation Systems

Businesses that purchase, finance or lease less than $2.5 million in business equipment during the 2018 tax year typically qualify for deductions through Section 179. Since the deduction begins to phase out if more than $2.5 million of equipment is purchased, it is most useful for small- to medium-size businesses.

How to Apply

Check out what qualifies under Section 179, or learn how to apply the Section 179 deduction. Consult your tax or accounting specialist to determine potential savings and eligibility.

To learn more about how Johnson Controls' family of products can help, contact us below:

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