Meta's data centers vs. your work truck: the tax rule that wrote off billions — and it's yours too

The senators’ letters are noise. The rule at the center is simple, legal, and permanent under current law — and it works on your equipment just as well as on a data center.

This week, a group of senators led by Sen. Elizabeth Warren sent letters to the chief executives of Amazon, Meta, Alphabet, and Microsoft, demanding details about the tax breaks tied to their AI data-center spending under last year’s big tax law, the One Big Beautiful Bill Act. The companies were asked to respond by October 11.

Here’s the part that matters for your business: those companies aren’t using some secret loophole. They’re using a rule you can use too.

The headline numbers behind the letters are real and startling: the Congressional Budget Office reported that corporate income-tax receipts fell $96 billion — 25% — over the first eleven months of fiscal year 2026, and the CBO itself said the 2025 tax law’s larger investment write-offs were a major reason. Per reports of the companies’ own SEC filings, Microsoft’s current federal tax expense fell by more than $11 billion between fiscal 2025 and 2026 while its pre-tax income rose; Meta’s fell by nearly $7 billion between 2024 and 2025 while its pre-tax income grew.

The mechanic, in one sentence

100% bonus depreciation lets a business deduct the FULL cost of qualifying equipment in the year it’s put to work — instead of spreading the deduction over five, seven, or more years.

Normally, when a business buys equipment, the IRS makes it “depreciate” the cost: deduct a slice each year over the asset’s life. Bonus depreciation skips the waiting line. A data center is just capital investment at gigantic scale — and the qualifying equipment inside it (servers, networking gear, electrical systems; the building shell itself doesn’t count) can potentially be written off in year one. At data-center scale, that single mechanism is what moved the multi-billion-dollar numbers in the headlines.

Why it’s back — and now permanent

Bonus depreciation isn’t new. The 2017 tax law set it at 100%, then put it on a countdown: 80% in 2023, 60% in 2024, 40% in 2025 — and it was scheduled to fall to 20% in 2026 before disappearing. The One Big Beautiful Bill Act, signed July 4, 2025, stopped the countdown and restored 100% permanently for qualifying property acquired after January 19, 2025. The IRS issued interim guidance on the new rules as Notice 2026-11 in January 2026.

Your version: the equipment you buy this year

The same rule works on the equipment your business buys — trucks, machinery, computers, office furniture. Used equipment qualifies too, as long as it’s new to you.

Take an illustrative example: a business buys $80,000 of qualifying equipment and puts it in service during 2026. Under the old phase-down, only a fraction would have been deductible this year; under 100% bonus depreciation, the business can potentially deduct the entire $80,000 on its 2026 return instead of spreading it over five years. (Your numbers will differ; “potentially” does real work in that sentence.)

The other first-year write-off got a boost too: the Section 179 expensing ceiling roughly doubled under the same law, to $2.56 million for 2026 (inflation-adjusted, per the IRS’s annual figures) — so small businesses have two doors into the same room.

The catch: timing, timing, timing

• “Placed in service” is the trigger, not the purchase date. Equipment bought in December but not delivered and ready to work by December 31 generally waits until next year’s return. With three months left in 2026, fourth quarter is the planning window.
• Business use matters. A vehicle has to be used more than 50% for business, and if business use later drops below that, some of the deduction can come back as income.
• Real estate doesn’t play. Land and buildings depreciate over 27.5 or 39 years — they don’t get bonus depreciation (though parts inside a building, like flooring and fixtures, sometimes do).

Alex Volkov, CPA is a New York-licensed CPA with over two decades in accounting, focused on resolving IRS tax problems — back taxes, liens, levies, garnishments, and audits — for individuals and businesses nationwide.