With the One Big Beautiful Bill Act (OBBBA), passing in July, 100% bonus depreciation has been reinstated for eligible technology purchases starting January 19, 2025. This marks the first time businesses can fully claim this benefit since 2022, presenting a valuable opportunity for grocers to reassess and optimize their technology investments throughout the year ahead.
Previously, bonus depreciation rates dropped to 80% in 2023 and 60% in 2024. Now, with 100% bonus depreciation permanently in the tax code for both new and used equipment, grocery retailers have a strong incentive to modernize operations while maximizing tax savings.
What Technology Qualifies for 100% Depreciation?
The scope of eligible technology is broader than many retailers realize. Qualifying purchases include:
- Computer Equipment: Servers, laptops, desktops, and related computer hardware that powers your store operations.
- Retail-Specific Technology: Electronic shelf labels, scanner scales, pin pads, monitors, touchscreens, and point-of-sale systems that directly support customer transactions and store management.
- Software Solutions: Computer software that integrates with your existing systems to enhance operations and customer experiences.
- Both New and Used: The legislation covers both new and previously owned equipment, expanding options for budget-conscious retailers.
The key requirement is that qualifying assets must have a recovery period of 20 years or less, which encompasses virtually all retail technology investments.
Why This Matters for Grocery Retailers
Immediate Cash Flow Benefits: Rather than depreciating technology costs over several years, retailers can now recognize the full expense immediately, significantly improving near-term cash flow and reducing current year tax obligations.
Leverage Advanced Technology: With razor-thin margins, grocery retailers need every advantage to compete effectively. Technologies like self-checkout or ESLs reduce labor costs while improving customer satisfaction.
Enhanced Customer Experience: Upgraded touchscreens and displays create smoother interactions, while integrated payment processing reduces transaction times during busy periods.
For regional retailers competing against big box stores, these improvements help maintain the personalized service customers expect while operating with the efficiency needed to compete against larger chains.
The Advantage of a Strategic Technology Partnership
We believe this is a significant opportunity for retailers to leverage tax incentives to benefit their store's operations. While TRUNO can help guide you in making informed retail technology purchases, it's important to research your state's specific tax laws and consult with accounting and tax professionals to ensure your business is adhering to federal tax laws and making the most of these tax savings.
By partnering with TRUNO, we help set your store up for success by providing the right technology tailored to your store’s unique needs. Our team works closely with you to understand your specific challenges and goals, ensuring that every one of your technology investments aligns with your business objectives.
With our expertise, your retail technology investments will streamline store operations, increase efficiency, and elevate customer experiences, all while potentially unlocking valuable tax benefits, giving your business even more opportunities to grow and thrive in today’s competitive market.
