The “Big Beautiful Bill,” signed into law last month, has stirred up major discussion in policy and business circles—and for good reason. Among its many provisions, one of the most impactful is a major overhaul of depreciation rules, which is being called a big win for businesses and manufacturers.
What’s Changing—and Why It Matters
At the center of the bill is the return of 100% bonus depreciation, a tax provision that allows businesses to immediately write off the full cost of certain capital assets, such as machinery, vehicles, or computers, instead of depreciating them over several years.
This is a major shift from previous law. Under the old schedule, businesses were only allowed to deduct 60% of asset costs in 2025, and 40% in 2026, as part of a phase-out of the original bonus depreciation enacted under the 2017 Tax Cuts and Jobs Act.
Now, with the new law in place, businesses can deduct 100% of the cost of qualified equipment purchased after January 19, 2025. That means faster tax savings and stronger incentives to invest in growth.
A Boost for U.S. Manufacturing
The bill doesn’t stop there. It introduces an additional incentive specifically for domestic manufacturers.
If your business invests in qualified production property—basically, equipment or facilities used in U.S.-based manufacturing—you’ll now benefit from 100% bonus depreciation through 2032. That’s eight full years of upfront tax savings for companies producing goods on American soil.
This long-term window gives manufacturers ample time to plan, expand operations, and upgrade their equipment—all while strengthening domestic supply chains and supporting the broader goal of revitalizing U.S. production.
Why This Matters for You
For business owners and manufacturers, these changes can translate to significant bottom-line benefits. Let’s say a company purchases $100,000 in new machinery in 2025. Under the old rules, they would have only been able to deduct $60,000 that year. Now, under the new law, they can deduct the entire $100,000 immediately—potentially lowering their tax bill by tens of thousands of dollars.
What’s Next?
If you’re considering a major investment in equipment or planning to scale up your manufacturing operations, now is the time to start planning. These changes are designed to reward forward-thinking businesses that invest in growth—especially those building and producing right here in the U.S.
If you have questions, contact Paragon today. As always, you can head to our Youtube for more breakdowns.
