Who doesn’t like to get extra money back on their taxes? Especially if you run your own business, that extra money can go a long way! Learn about Section 179?
Did you know if you’re a self-employed businessman you can qualify for the Section 179 Tax Deduction? Sounds complicated? It’s not!
Section 179 of the IRS Tax Code essentially lets businesses “deduct the full purchase price of qualifying equipment and/or software purchased of financed during the tax year.” [X] So what does that mean? It means that if you purchase or finance a piece of qualifying equipment, like a vehicle, Section 179 allows businesses to deduct the full purchase price!
Several years ago businesses had to deduct the price of qualifying equipment over several years through depreciation. And while Section 179 lets business owners deduct the entire price of qualifying equipment at once, it does have limits to how much a business can claim.
There are caps a business can claim through Section 179. According to the official IRS website, “The maximum amount you can elect to deduct for most section 179 property you placed in service in tax years beginning in 2017 is $510,000 ($545,000 for qualified enterprise zone property). This limit is reduced by the amount by which the cost of section 179 property placed in service during the tax year exceeds $2,030,000.”
So, who exactly qualifies for Section 179? While big businesses can take advantage of Section 179, small and medium-sized businesses can really benefit the most. According to the Section 179 website, “all businesses that purchase, finance, and/or lease new or used business equipment during tax year 2018 should qualify for the Section 179 Deduction (assuming they spend less that $3,500,000).”
For a list of qualifying property that Section 179 covers, please visit the Section 179 website.
If you’d like to speak to someone to find out more about how your business can qualify, please visit the Payne Auto Group website.