LED Lighting Tax Deduction: Section 179 Guide for Businesses
How to deduct LED lighting costs under Section 179. Eligibility, limits, and how to maximize your tax benefit on commercial LED upgrades.
Can You Deduct LED Lighting on Your Taxes?
Yes. LED lighting fixtures qualify as equipment under IRS Section 179, allowing businesses to deduct the full purchase and installation cost in the year the lights are placed in service — rather than depreciating them over several years.What is Section 179?
Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment in the current tax year, instead of capitalizing and depreciating it over its useful life.
2026 Section 179 Limits
- Maximum deduction: $1,220,000
- Spending cap: $3,050,000 (phase-out begins above this)
- Bonus depreciation: 60% for 2026 (decreasing from 100% in 2022)
What LED Lighting Qualifies?
✅ Eligible:
- LED fixtures (high bays, troffers, panels, area lights, wall packs)
- LED retrofit kits
- Lighting controls (sensors, dimmers, timers)
- Installation labor (if capitalized with the fixture)
- Poles and mounting hardware
❌ Not eligible:
- Light bulbs alone (consumable supplies, not equipment)
- Repairs to existing non-LED fixtures
Tax Savings Example
$50,000 LED lighting upgrade for a warehouse:| Tax Bracket | Tax Savings | Net Cost After Tax Benefit |
|---|---|---|
| 21% (C-corp) | $10,500 | $39,500 |
| 24% | $12,000 | $38,000 |
| 32% | $16,000 | $34,000 |
| 37% | $18,500 | $31,500 |
Combined with utility rebates ($5,000-$15,000), your effective cost could be 40-60% below list price.
How to Claim
Maximize Your LED Tax Benefit
Ready to Upgrade?
Auvolar provides detailed invoices that clearly separate fixture costs, making it easy for your accountant to process the Section 179 deduction.
[Get a quote →](mailto:sales@auvolar.com) | [Call (626) 342-8856](tel:6263428856)Need Help With Your Lighting Project?
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