If your company needs an equipment overhaul\nto bring your business up to speed, or if you\u2019re getting ready for a major new investment,\nnow is the right time to pull the trigger thanks to this year\u2019s updates to\nSection 179.<\/p>\n\n\n\n
Section 179 is an important part of the IRS\ntax code that lets businesses deduct the full <\/strong>purchase price of\nqualifying equipment (or software) from their gross income. <\/p>\n\n\n\n Qualifying purchases must be made during the\ntax year\u2014that means if you\u2019re looking to take advantage of Section 179 this\nyear, you\u2019ll need to purchase the equipment and get it up and running before\nthe end of the day on December 31, 2019.<\/strong><\/p>\n\n\n\n Nearly all tangible goods used by your business (at least 50% of the time) are eligible for the Section 179 Deduction. While the list is self-explanatory, there are a few exceptions, especially when it comes to items that are purchased for both business and personal use. (Find out if your equipment qualifies here<\/strong><\/a>.)<\/p>\n\n\n\n Qualifying equipment\nmust be purchased between January 1 and December 31 of the tax year to take\nadvantage of the deduction. If you tend to lease your equipment, you\u2019re also in\nluck\u2014whether\nthe equipment is new or used, purchased, <\/strong>leased or financed<\/strong><\/a>, it still\nqualifies.<\/strong><\/p>\n\n\n\n This year, the total amount you can write off\n(the deduction limit) is capped at $1,000,000\u2014but you also have spending caps\nto take in mind. For the 2019 year, the maximum amount you can spend on\nequipment is $2,500,000 in order to receive a full deduction. Once you surpass\nthis threshold, the deduction is incrementally reduced until you spend more than\n$3,500,000, at which point you no longer receive a deduction.<\/p>\n\n\n\n Companies who exceed the Section 179 spending\ncap can still benefit this year, thanks to Bonus Depreciation\u2014an incentive that\nlets you deduct a percentage of the purchase price the year equipment is\npurchased, instead of having to write it off over the spam of the equipment\u2019s\nuseful life. <\/p>\n\n\n\n This year both new and used\nequipment that is new to your company qualify for the Bonus Depreciation\ndeduction. Even better, this year\u2019s depreciation rate is 100%.<\/strong><\/p>\n\n\n\n Section 179 limits and incentives fluctuate\nfrom year to year, and bonus depreciation is not always offered. Many years, it\nis only offered at 50% or less. That makes this year an attractive time for\nc-stores and gas station owners, fleets, UST operators, farmers, manufacturers\nand just about business to finally upgrade to new equipment and make new\ninvestments that position themselves to outperform their competition.<\/p>\n\n\n\n Although Section 179 can help ALL businesses\ninvest in themselves, it was designed specifically to provide tax relief for\nsmall and medium sized businesses. If your equipment is eligible\u2014that means you\nare eligible. <\/strong><\/p>\n\n\n\nWhat Kind of Equipment Qualifies\nfor the Deduction?<\/strong><\/h4>\n\n\n\n
Limits\nand Caps<\/strong><\/h4>\n\n\n\n
Bonus\nDepreciation<\/strong><\/h4>\n\n\n\n
Can\nMy Business Take Advantage of Section 179?<\/strong><\/h4>\n\n\n\n
Next\nSteps<\/strong><\/h4>\n\n\n\n