Buy qualifiying equipment and software and get the maximum deduction.
Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment purchased or financed during the tax year. That means that if you buy (or lease) a piece of qualifying equipment, you can deduct the full purchase price from your gross income. It’s an incentive creative created by the US Government to encourage businesses to buy (or lease) equipment to re-invest in their growth.
Jobs Act of 2010
H.R. 5379 aka Small Business Jobs and Credit Act of 2010 increased the maximum Section 179 deduction to $500,000 for qualifying equipment and software placed in service for tax year 2011.
Tax Relief Act of 2010
Bonus Depreciation was increased by the Tax Relief Act of 2010 on December 17, 2010, allowing businesses to use the first year Bonus Depreciation of 100 percent on qualified assets purchased after September 9, 2010, but no later than December 31, 2010.
Section 179 covers both new and used equipment, whereas Bonus Depreciation covers only new equipment.
The material provided is for information purposes only. Please consult with your tax professional for advice, or visit www.irs.gov.