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Can a landscaping business deduct the cost of a trailer and mowing equipment in the first year?

Yes. Section 179 of the tax code allows landscaping businesses to deduct the full cost of qualifying equipment in the year it’s purchased rather than depreciating it over several years. For 2024, the deduction limit is $1,220,000, which is more than enough to cover most landscaping equipment purchases. Mowers, trailers, trucks, skid steers, aerators, blowers, and similar tools all qualify.

The equipment has to be used more than 50% for business purposes to qualify. For most landscaping companies this is not an issue since a commercial zero-turn mower or enclosed trailer isn’t getting much personal use. But if you buy a pickup truck and drive it on weekends for personal errands, you need to track business versus personal mileage honestly. Only the business-use percentage qualifies for the deduction.

Bonus depreciation is another option that works alongside or instead of Section 179. For 2024, bonus depreciation allows you to deduct 60% of the cost of new or used equipment in the first year, with the remainder depreciated normally. Section 179 is generally the better choice for home and property service businesses buying equipment under the limit, but your specific situation determines which approach saves you more.

Taking the full deduction in year one isn’t always the smartest move. If your landscaping business had a low-revenue year or you’re already showing a loss, a large Section 179 deduction doesn’t help much because there’s not enough taxable income to offset. In that case, spreading the depreciation over five or seven years puts the deduction in future years when you actually need the tax relief. This is a strategic decision, not just a yes-or-no question.

You also need to actually place the equipment in service during the tax year you’re claiming the deduction. Buying a mower in December but not using it until the following spring means you may not qualify for the deduction in the purchase year. “Placed in service” means ready and available for use in your business, not just sitting in your shop.

Keep clean records of every equipment purchase including the date, cost, and how it’s used in the business. Save receipts and financing documents. If you’re audited, the IRS will want to see proof that the equipment qualifies and that it meets the business-use threshold. Having your books organized through construction job costing in Phoenix or proper bookkeeping makes this straightforward instead of stressful.

One more thing worth mentioning. Section 179 applies to purchased or financed equipment but not leased equipment where you don’t own it at the end of the lease. If you’re financing a trailer through a loan, you can deduct the full purchase price in year one even though you’re still making payments. That’s a significant cash flow advantage for growing landscaping companies that need equipment but don’t want to pay cash upfront.

Talk to your tax preparer before making large equipment purchases so you understand exactly how the deduction will affect your return. The right timing and structure can save you thousands.

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