100% First-Year Depreciation Is Now Permanent: How the One, Big, Beautiful Bill Creates Powerful Tax Savings for Business Owners in 2026
Major tax planning opportunities are now available for businesses, creators, medical practices, and high-income investors thanks to a key change in the One, Big, Beautiful Bill (OBBB). The new law permanently restores 100% first-year depreciation (also called bonus depreciation) for qualifying business property acquired after January 19, 2025.
This means eligible equipment, technology, production assets, and even certain sound recordings can now be fully deducted in the year they are placed in service, instead of being written off slowly over several years.
At Velin & Associates, Inc., our clients are already using this change to dramatically lower their 2025 and 2026 tax bills.
Let’s break down how this works and how it could apply to your business.
What Is 100% First-Year Depreciation?
Normally, when a business buys equipment, software, machinery, or production assets, those purchases must be depreciated over 3, 5, 7, or even 39 years. This spreads the tax deduction out slowly—even though the cash was spent upfront.
Under the new OBBB rules, qualifying property placed in service after January 19, 2025 can now be:
100% expensed in the first year
This accelerates deductions and creates powerful cash-flow advantages for businesses of all sizes.
What Types of Property Qualify?
Eligible property generally includes:
- Computers, cameras, servers, and production equipment
- Medical and dental equipment
- Manufacturing and warehouse equipment
- Technology for Shopify stores and Amazon businesses
- Office equipment and furniture
- Certain vehicles used in business
- Qualified sound recording productions
- Self-constructed property and major improvements
This applies whether you are a Business Owner, YouTuber, Shopify Store owner, Doctor, Filmmaker, or CPA for High Net Worth Individuals seeking tax-efficient growth.
Examples
🎥 YouTubers, TikTokers & Creators
A YouTube production company invests $95,000 in cameras, lighting, editing computers, and studio equipment. Under the old system, those assets would be depreciated over five years.
With 100% bonus depreciation, we could deduct the entire $95,000 in the first year—reducing taxable income dramatically and freeing up cash for growth.
This is especially powerful for Creators, for TikTok creators, and for Filmmakers who rely on equipment to produce revenue.
🛒 Shopify Stores & Amazon Businesses
An online commerce business upgrades its warehouse automation, packaging machines, and inventory tracking systems for $180,000.
Using first-year depreciation, our Shopify store and Amazon business clients can write off the entire investment in the same year—lowering their taxes while scaling their operations.
This creates a major advantage for Online Commerce clients who reinvest heavily in infrastructure.
🦷 Doctors, Dentists & Medical Practices
A dental practice purchases new imaging equipment, chairs, sterilization units, and digital records systems for $300,000.
Instead of depreciating those assets over seven years, we could apply 100% bonus depreciation to deduct the entire amount in year one—significantly lowering taxes for Dentists, Doctors, and Medical Practice clients.
This allows healthcare providers to modernize while keeping more cash.
🎙️ Sound Recording & Entertainment Businesses
The OBBB now allows qualified sound recording productions to qualify for first-year depreciation. This includes recording costs, production, mixing, mastering, and studio expenses once recording begins.
A film and music studio records a new album and podcast series in late 2025. With proper structuring, filmmakers and entertainment industry clients could deduct most or all of the production costs in the first year instead of spreading them out over time.
This is a major benefit for entertainment and digital media businesses.
Strategic Elections That Matter
The law also allows businesses to make strategic elections, including:
- Choosing 40% or 60% depreciation instead of 100%
- Applying depreciation to specific assets or plants
- Treating certain self-constructed components separately
- Excluding certain sound recordings
At Velin & Associates, Inc., we analyze whether full expensing or partial depreciation creates the best long-term tax outcome—especially for High Net Worth Individuals and Business owners managing income spikes, real estate, and investment portfolios.
Why This Matters for Tax Planning in Los Angeles
Los Angeles businesses—from tech startups to medical practices and creators—are capital-intensive. The ability to deduct equipment immediately can:
- Reduce federal and California taxes
- Improve cash flow
- Fund growth without loans
- Increase return on investment
- Strengthen long-term tax strategy
This is why tax and business planning must be strategic and coordinated—not reactive.
Final Thoughts
The One, Big, Beautiful Bill permanently changed how business investments are taxed. No matter what type of business you run, the ability to expense 100% of qualifying assets in year one is one of the most powerful tax tools available.
At Velin & Associates, Inc., we specialize in aligning depreciation strategy with growth, cash flow, and long-term tax efficiency. For more information about our tax planning services, contact us today: visit our website.
Velin & Associates, Inc
8159 Santa Monica Blvd STE 198/200 West Hollywood, CA 90046
323-902-1000
dmitriy@losangelescpa.org
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Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Tax articles in this e-newsletter are not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.