The $100,000 Write-Off: Mastering Equipment Deductions with Section 179: How Laundromat Owners Can Maximize Equipment Deductions and Save Big on Taxes

"Laundry is a lot like life: full of twists and turns, tough stains, and sometimes, unexpected folds."— Anonymous

Running a laundromat means dealing with a lot more than soap and cycles. There are machines to maintain, utilities to manage, customers to please—and taxes to keep under control. But if you know where to look, your business gives you some powerful tools to lower your tax bill—especially when it comes to equipment deductions.

Enter Section 179 and Bonus Depreciation, two of the most valuable provisions in the tax code for small business owners. Used correctly, they can let you write off up to $100,000 or more in washers, dryers, kiosks, and even security systems—all in the same year you buy them.

This post breaks it all down and includes what to do if the IRS ever comes knocking. So let’s sort it all out and make sense of the cleanest deduction in your tax toolbox.

Section 179: Your Fast-Pass to Equipment Tax Deductions

Section 179 allows business owners to immediately deduct the full purchase price of qualifying business equipment and property—rather than depreciating it over several years. That means big upfront tax savings when you invest in your laundromat.

🔧 Key Facts for 2025:

• Deduction limit: $1,220,000

• Phase-out threshold: $3,050,000 in total equipment purchases

• Deadline: Must be purchased and in service by December 31

  
  

So if you buy $100,000 worth of equipment this year, and it qualifies, you can likely deduct the full amount from your taxable income—this year.

That’s real, immediate savings that can free up cash to reinvest in your business.

Bonus Depreciation: What Happens After You Hit the Limit

If you go beyond Section 179 limits—or your income is too low to absorb it—you’ve got backup.

Bonus depreciation lets you deduct a large portion (currently 60%) of the cost of qualified property in year one. The percentage is gradually being phased down each year:

• 2025: 60%

• 2026: 40%

• 2027: 20%

• 2028+: Set to expire unless extended by Congress

  
  

Bonus depreciation applies even if your business runs at a loss—which makes it more flexible than Section 179 in certain scenarios.

What Equipment Qualifies for Section 179?

Not everything counts—but for laundromats, most of your big-ticket purchases qualify.

Eligible Property:

• Washers & dryers

• Laundry payment systems (card readers, kiosks, apps)

• Soap vending machines

• Folding tables, carts, seating

• Security systems (cameras, alarms)

• Water heaters and filtration systems

• POS systems and laundry software

• Shelving and storage units

• HVAC units, if part of specific energy-efficient property upgrades

  
  

What’s NOT Eligible:

• The building structure or any land

• Cosmetic renovations with no business function

• Inventory or consumables (like detergent)

• Equipment used for personal purposes

  
  

  Important: The equipment must be used at least 50% for business to qualify, and it has to be placed in service before December 31 to count for the current tax year.

Real-World Example: A $100,000 Equipment Write-Off

Let’s say you own a mid-sized laundromat and upgrade your setup.

Here’s your 2025 equipment purchase:

Equipment	Cost
8 Commercial washers	$56,000
6 High-capacity dryers	$36,000
POS system and payment kiosk	$6,000
Folding tables, carts, and seating	$2,000
Total Investment	$100,000

If all of this qualifies (and it usually does), you can take a $100,000 Section 179 deduction this year.

Tax Savings:

If you’re in the 22% federal tax bracket, that’s:

$100,000 x 22% = $22,000 in tax savings

That’s money you can use to invest in marketing, staff, repairs—or stash away for a second location.

And don’t forget: If you go over $1.22 million in purchases, you can apply bonus depreciation to the rest.

Can You Finance Equipment and Still Deduct It?

Yes—you don’t need to pay for the equipment in full to claim the deduction. As long as:

• The equipment is purchased (not leased)

• It’s placed in service by year-end

• It’s used for business

  
  

…you can still claim Section 179, even if you’re financing the purchase with monthly payments.

This is a huge advantage. You can get the full deduction now, and spread out the payments over several years. That’s how you grow without bleeding cash.

Combining Section 179 and Bonus Depreciation: A Power Move

Here’s how to combine the two for maximum tax benefit.

Example:

You purchase $1.5 million in equipment and improvements in 2025.

• First $1,220,000 is deducted using Section 179

• Remaining $280,000 is eligible for 60% bonus depreciation = $168,000

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Total first-year deductions: $1,388,000

That could mean six figures in tax savings, depending on your income. It’s one of the most aggressive write-offs allowed by law—and completely legal when done right.

How to Survive an IRS Audit (And Prove Your Deductions)

Writing off $100,000+ in equipment is great—until the IRS wants to take a closer look. Audits are rare, but they do happen, especially when big deductions are involved.

Here’s how to protect yourself and survive an audit with confidence.

1. Keep Detailed Invoices

Save itemized invoices for every purchase. Ideally, they should include:

• Purchase date

• Item description and model #

• Cost per unit

• Vendor info

• Serial numbers (for major assets)

Avoid lump-sum invoices like “Laundromat Package – $85,000.” Break everything down.

2. Prove Business Use

If you’re writing off equipment under Section 179, you must use it more than 50% for business. In a laundromat, this is easy—machines are your business. But:

• Keep photos or videos showing the equipment in use

• Save service records, water bills, or utility data

• Document any installation dates or tech support calls

  
  

3. Confirm It Was Placed in Service

The IRS only allows deductions for property placed in service during the tax year—so don’t count machines that were still sitting in a warehouse on December 31.

You can prove placement with:

• Installation records

• First service receipts

• Utility connection logs

• Operator training dates

  
  

4. Use a Fixed Asset Ledger

This is a spreadsheet or software record listing all depreciable assets:

• Description

• Purchase date

• Cost

• Depreciation method (e.g., 5-year MACRS or Section 179)

• Location

Keep it up to date every year. If you’re ever audited, the IRS will want to see this.

5. Maintain Financing Agreements

If you financed equipment, keep copies of:

• Loan or finance agreements

• Payment schedule

• Proof of ownership transfer (you must own the equipment, not lease it)

This helps prove that you qualify for Section 179, which only applies to purchases, not operating leases.

6. Consult a Tax Pro

Having a CPA or tax advisor familiar with Section 179 in your corner means:

• Proper classification of equipment

• Documentation support

• Representation if the IRS sends a letter

Pro tip: If the IRS sends you a notice, don’t panic—but don’t ignore it. Respond on time and call your advisor immediately.

Common Mistakes to Avoid

Even smart business owners sometimes make expensive Section 179 mistakes. Here's how to dodge them:

🚫 Mistake 1: Claiming equipment not yet installed You can’t deduct something that hasn’t been “placed in service,” even if it’s paid for.

🚫 Mistake 2: Forgetting about the 50% business-use rule Using equipment part-time for personal use? You’ll lose the deduction.

🚫 Mistake 3: Overlooking used equipment Yes, used washers and dryers qualify too—as long as you’re the one placing them in service.

🚫 Mistake 4: Assuming every improvement qualifies Permanent fixtures or structural renovations often fall outside Section 179. They might qualify for bonus depreciation or QIP, but not always Section 179.

Final Thoughts: Don’t Miss Your Window

Section 179 is one of the most generous deductions in the tax code for laundromat owners. And it's especially powerful if you're upgrading machines, investing in new tech, or opening a new location.

But it’s not automatic—you’ve got to plan for it, document it, and use it wisely.

If you’re spending money on equipment this year, don’t wait until tax season to figure it out. Put a strategy in place now so you can claim every dollar you’re entitled to—and survive an audit if it comes to that.

💼 Need Help with Your Equipment Deductions?

We specialize in laundromat accounting and tax planning. Whether you're upgrading a few machines or doing a full buildout, we’ll help you:

• Identify qualifying equipment

• Maximize your Section 179 and bonus depreciation

• Prepare bulletproof documentation

• Avoid red flags that trigger audits

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📅 Book a free consultation today

Let’s make your next upgrade the cleanest write-off you’ve ever had.