Purchasing capital equipment comes with some tax benefits that not every company is familiar with. You might be asking yourself “What is Section 179?” and “How can I reap the tax benefits of my new equipment this year?” We will walk through what this part of the tax code is and how it can apply to your business
*F900 Total First Year Deduction: $549,900
*F370 Total First Year Deduction: $59,900
*J850 Total First Year Deduction: $250,000
*J55 Total First Year Deduction: $99,000
Section 179 of the IRS Tax Code allows businesses to deduct the full purchase price of qualifying equipment and/or software purchased or financed during the tax year. What it boils down to is, if you’ve purchased or leased qualifying equipment, you can deduct the full purchase price from your gross income.
This feature is hugely beneficial for small to medium-sized businesses who are looking to invest in themselves. 3D printing equipment is one of the best ways your organization can grow in the coming year. Taking advantage of this special tax incentive allows you the ability to make an investment now, realize the tax benefits now, and see the impact the technology brings.
When you purchase new capital equipment in the past, it was very common to simply allow that asset to be written off over time through depreciation. The big benefit of Section 179 is the ability to realize the full benefit of the full price in the year you bought it, up to $1,050,000*. The big caveat to this is what’s known as the “More than 50% Business Use Requirement”. This rule simply says that in order to qualify, the deduction must be in used more than 50% of the time. Knowing this, you can estimate the amount eligible by multiplying the cost by the percentage of use. This website devoted to Section 179 has a great calculator.
CADimensions wants to help make it easy for you to realize the benefits of this government tax incentive to help your business. Contact us today to speak with a specialist who can answer all your questions.
*See official IRS website for full details