Section 179 Tax Savings

Section 179 Tax Savings

Do not miss out on 2017 equipment tax benefits.

Businesses have significant reasons to acquire and install capital equipment before the end of 2017. Section 179 deduction is $500,000.00, where it will remain for all of 2017. Section 179 cap will be indexed to inflation in $10,000 increments in future years.

Highlights for tax benefits:

  • The allowable Section 179 deduction has been increased to $500,000.00 on the cost of new and used equipment and software purchased through 12/31/2017
  • Allows a 50% bonus depreciation of the cost of new equipment [under certain conditions] through 12/31/2017

Section 179 deduction

For 2017, companies can expense up to $500,000.00 as a deduction as long as total purchases do not exceed$2.5 million.

  • Applies to new and used equipment
  • Can be combined with bonus depreciation
  • The maximum qualified equipment investment amount that is eligible for the full $500,000 deduction in 2017 is $2 million
  • Beyond the $2 million maximum equipment there is a dollar for dollar phase-out of the Section 179 Deduction
  • Equipment acquisitions exceeding $2.5 millionaire not eligible for any Section 179 deduction

Bonus Depreciation

The enhanced bonus depreciation benefit allows an additional immediate write-off of 50% of the undepreciated balance for capital expenditures and depreciable property (new equipment only).

  • Applies to new equipment only that is placed in use in the United States in the 2017 calendar year
  • Equipment must be depreciable under the Modified Accelerated Cost Recovery System (MACRS) and have a depreciation recovery period of 20 years or less

Because of the value of accelerated deductions vs. recovery over time, you may find it valuable to better understand these tax provisions and determine if they can work to your advantage. Don’t delay speak to your tax and accounting advisors today to maximize these and other incentives this year.

Subject to credit approval. We are not offering legal, tax or financial advice. You should consult with your tax advisor for the specific impact to your business. We are not responsible for and do not guarantee the products, service or performance of third parties. Financing programs void were prohibited.

 

For more information please click here to visit the IRS Publication 946 website.

 

Download Section 179 Information

For additional information, please visit www.irs.gov

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