How do I deduct a large piece of equipment that I purchased on a loan (have not paid it off yet) that is being used for business?

Enter it in the Assets/Depreciation interview of TurboTax Self-Employed (or Home and Business).

 

The interview will ask all the necessary questions to determine whether and how you can deduct the cost of the purchase. If you qualify, you may be able to deduct the full amount of the purchase in 2020 (See Section 179).

 

It does not make any difference how you paid for (e.g. cash or financed) the equipment.

 

Any interest paid on the equipment loan is a deductible business expense ("business interest").