IMPORTANT TAX NEWS
Take full advantage of new tax incentives for manufacturers
See how the One Big Beautiful Bill Act (OBBBA) can enhance your bottom line
The One Big Beautiful Bill Act of 2025 supports U.S. manufacturers with important tax incentives to increase capital investment. If you've been planning to add new production capacity and equipment, now is the time to take advantage of write-offs, depreciation and deductions from this important legislation.
Liberate your cash flow with new equipment-cost deductions under IRS Section 179. Deduct up to $2.5 million now.
100% bonus depreciation is back. Write off the entire cost of new equipment in the year you place it into service. No cap on the deduction amount; no phase-outs or income limits. Even carry a net operating loss forward to offset future taxes.
Additionally, deduct 100% of R&D costs in the same year you incur them. No need to amortize them over a five-year period.
Apply these tax benefits now to new Mazak equipment – and boost your production along with your bottom line.
If you're ready to expand but concerned about preserving your margins and avoiding the impact of tariffs, now is the time to get in the game.
Savings Examples
Example 1: Job Shop Investment
Scenario: A small job shop purchases one new Mazak machine
Total Machine Cost: $350,000
Tax Treatment:
- Section 179 Deduction: $350,000
- Bonus Depreciation Deduction: $0
- Total First-Year Deduction: $350,000
- Estimated Tax Savings (21% Rate): $73,500
- Net Effective Cost (After Tax Savings): $276,500
Result: Because the total purchase is well below the $2.5 million Section 179 limit, the job shop can fully expense the machine under Section 179 assuming the business is profitable enough to absorb the deduction. If not, bonus depreciation may still apply, as it can be used even if the business shows a loss.
Example 2: Corporate Multi-Machine Investment
Scenario: A large corporate manufacturer purchases eight Mazak machines
Total Machine Cost: $5,000,000
Tax Treatment:
- Section 179 Deduction: $1,500,000 (reduced due to phase-out)
- Bonus Depreciation Deduction: $3,500,000
- Total First-Year Deduction: $5,000,000
- Estimated Tax Savings (21% Rate): $1,050,000
- Net Effective Cost (After Tax Savings): $3,950,000
Result: Because the purchase exceeds the $4 million phase-out threshold, the allowable Section 179 deduction is reduced by $1 million. The remaining cost is fully deductible under 100% bonus depreciation.
Mazak is not a tax advisor or accounting firm. Customers should always consult their tax professionals before making capital equipment purchase decisions.