TurboFunding.com
If you are pricing equipment in 2026, you have probably noticed that the sticker shock of 2022 and 2023 has not really gone away. Prices have stabilized in most categories, but stabilized at a higher level than anyone was paying before the pandemic. New trucks, excavators, kitchen lines, and medical lasers all reset to a new baseline, and that baseline is not coming back down.
The good news is that the financing market has adjusted alongside it. Lenders are extending terms to match longer payback periods, the used market has loosened up after three years of constrained supply, and the tax code still gives owners a real lever with Section 179 and bonus depreciation. This guide walks through what equipment prices actually look like in 2026, how to structure financing around them, and where the tax math changes the answer.
Equipment prices remain elevated, and your financing term should match
Across nearly every commercial equipment category we underwrite, prices in 2026 are still notably higher than they were before 2020. New Class 8 trucks remain roughly 15-30% above pre-2020 pricing, with some supply normalization helping at the margin but not enough to roll the curve back. Construction equipment (excavators, dozers, wheel loaders) stabilized through 2024 and 2025, but stabilized at an elevated baseline rather than dropping. Aesthetic and medical device pricing has actually drifted flat-to-up as manufacturer consolidation reduces competitive pressure on price. Restaurant kitchen equipment is stable, with a premium attached to electric and induction commercial gear that did not exist five years ago.
What this means in practice: the principal you are financing is bigger, which means the monthly payment is bigger, which means matching the loan term to the useful life of the asset matters more than it used to. A 36-month term made sense on a $120K truck. On a $180K truck doing the same work, that same 36-month term creates a monthly payment that strains revenue. Stretching to a 60 or 72-month term, matched to the realistic 7-10 year useful life of the equipment, keeps the payment in line with the cash flow the truck actually produces.
This is the single most common structural mistake we see right now. Owners price a 2026 piece of equipment using 2019 financing assumptions, get sticker-shocked at the monthly payment, and either walk away from a deal that would have made money or take a shorter term that eats their margin. The right move is almost always to match term to useful life, then make sure the asset actually earns its keep over that horizon. Our equipment financing program structures most new equipment loans at 36-84 months depending on asset class. For more on choosing between lease, finance, and outright purchase, see our piece on equipment financing structures.
Section 179 and bonus depreciation are still powerful in 2026
The tax code has not given up on equipment buyers. In 2026, Section 179 lets a business expense up to $1,160,000 of qualifying equipment in the year of purchase, with the deduction beginning to phase out once total equipment spend crosses $2.89 million. For a profitable business in the 21% federal corporate rate, fully using the $1.16M Section 179 limit translates to roughly $243,000 of cash tax savings in that purchase year. That is real money, not a theoretical accounting entry.
Bonus depreciation in 2026 sits at 40%, phased down from the 100% level that ran through 2022 under current law. Bonus depreciation applies to the remaining basis after Section 179, which means the two stack rather than compete. On a typical equipment package for a mid-market operator, the combined effect of Section 179 plus 40% bonus depreciation produces a realistic effective discount of 25-45% on the sticker price, depending on the buyer's tax bracket and how much taxable income there is to absorb the deduction.
That last point is the critical one. Section 179 and bonus depreciation are only valuable if you have taxable income to offset. A business sitting on a net operating loss carryforward is going to get far less immediate benefit, because there is no income for the deduction to shelter. An S-corp or LLC where the deduction flows through to the owner's personal return changes the math again. Before you write a check based on the tax savings, the conversation belongs with your CPA, not with your equipment vendor or your lender. The vendor wants the sale, the lender wants the loan, and your CPA is the only person whose job is to tell you the deduction is actually worth what you think it is.
One more piece of the puzzle: equipment financed through a loan still qualifies for Section 179 and bonus depreciation in the year of purchase, even though you have not paid for it in cash yet. That is the part of the tax code that makes financing genuinely compelling. You can deduct the full eligible amount, take delivery of the equipment, and amortize the cost over 5-7 years while the tax savings hit your return in year one. For owners planning a larger purchase, a term loan or SBA 7(a) loan can roll equipment, working capital, and even a build-out into one closing.
Used equipment financing is back, and often the smarter buy
The used equipment market in 2026 looks very different than it did in 2022 and 2023. Inventory has loosened up, prices on 3-5 year old assets in good condition run roughly 15-25% below comparable new units, and the lenders who pulled back from used during the supply crunch are advancing again. For a lot of operators, used is now the better economic answer, not a compromise.
Here is the comparison we run with clients almost every week. A new $300K excavator at 80% advance, 7-year term, and 9.5% APR comes out to roughly $4,300 a month. A 5-year-old equivalent excavator at $200K, financed at 70% advance, 5-year term, and 11% APR, comes out to about $3,000 a month. That is $1,300 a month in payment difference and a financing window that ends two years sooner. On the same revenue, the used machine puts substantially more cash back in the business each month. If the used asset has a documented maintenance history and a reasonable remaining warranty (most quality used iron carries 12-24 months of manufacturer or third-party warranty in 2026), the economics often favor used decisively.
The catch is that lender advance rates on used run 50-80% versus 80-100% on new, so you need more down payment. The interest rate is also typically 1-3 points higher because the collateral risk is greater. Both of those factors are baked into the comparison above, and even with the higher rate and bigger down payment, used wins on monthly cash flow in most realistic scenarios. The owners we see making this work well are the ones who buy from reputable resellers with verifiable hours, service records, and an inspection report. Auction buys without that documentation are far harder to finance and far riskier to operate.
For specific industry breakdowns, our guides on construction company financing and trucking and transportation business loans go deeper on how lenders price new versus used in those categories. If you already own equipment and want to pull capital out of it, our piece on equipment sale-leaseback covers a related play that gets overlooked.
How TurboFunding Helps
TurboFunding finances equipment for owner-operators, small fleets, contractors, restaurants, and medical practices across the country. We fund both new and used equipment from $10K to $5M, accept 550+ FICO, and require $10K+ in monthly revenue with 6+ months in business. Our underwriting team sizes terms to match the useful life of the asset, not the calendar, and we work directly with manufacturer reps and dealers when that simplifies the close. For larger packages that combine equipment, working capital, and a build-out, we can structure an SBA 7(a) loan or a conventional term loan in a single closing. The 3-minute application uses a soft credit pull, so checking your rate does not affect your score. Find out More.
Frequently Asked Questions
Q. Are equipment prices going to come down further in 2026?
A. Most categories have already stabilized at an elevated baseline. There is some supply normalization in trucks and construction iron, but manufacturer pricing power, input costs, and emissions compliance costs all argue against a meaningful rollback. Waiting for 2019 prices to return is not a strategy.
Q. Can I claim Section 179 on financed equipment?
A. Yes. The IRS treats equipment financed through a loan or equipment finance agreement the same as cash purchases for Section 179 purposes. You take delivery, place the asset in service, and the full eligible deduction is available in the year of purchase. Confirm specifics with your CPA, especially around timing of placement in service.
Q. What advance rates should I expect on used equipment in 2026?
A. Generally 50-80% of the purchase price for documented used equipment from a reputable seller, versus 80-100% on new. Older assets, private-party sales, and auction buys typically land at the lower end of that range. A clean maintenance history and an inspection report from a qualified third party can move the advance rate up.
Q. Does it make sense to use Section 179 if I am not very profitable this year?
A. Probably not for the full amount. Section 179 cannot create a net operating loss, so the deduction is capped at your taxable income. Bonus depreciation can create a loss that carries forward, but the immediate cash benefit is smaller. This is exactly the conversation to have with your CPA before the purchase, not after.
Q. How fast can equipment financing close in 2026?
A. For a clean file with standard documentation, 2-5 business days is typical for both new and used. Larger packages or SBA-backed equipment loans take longer, generally 45-90 days for SBA 7(a). If you are working against a vendor delivery deadline, get the application in early and have your tax returns and bank statements ready.
The right equipment purchase in 2026 is not just about the sticker price. It is about matching the financing structure to the asset's useful life, using the tax code where it actually helps, and being honest about whether new or used is the better economic answer for your specific use case. The owners who get this right keep their monthly payment in line with the revenue the equipment produces and let Section 179 and bonus depreciation do real work on the tax bill. If you are pricing a 2026 purchase and want a second opinion on how to structure it, apply in 3 minutes with a soft credit pull. Find out More.
Last updated: May 2026.