Many people are unaware that Section 179 is in full effect this year, and we want to provide you with a reminder of some of the major points.
Below are the basics of Section 179…
- Buy and place equipment into service by December 31st to deduct up to the $500,000 limit (subject to basis and income limitations).
- Business vehicles of at least 6,000 lbs. gross vehicle weight rating also qualify for a deduction with a limit of $25,000 for SUV’s. Certain pick-up trucks with a bed do not have the $25,000 limit.
- There is a 50% bonus depreciation for new equipment/vehicles not deducted under Section 179. First year cap on depreciation of autos, light trucks or vans is up to $11,600 from $3,060.
- Certain qualified real estate improvements (TI) can be included ($250,000 limit) with the 50% bonus depreciation.
- A new build can be broken down by asset type to achieve maximum tax benefit (Section 179 & bonus depreciation). Even an existing building purchased can achieve a similar result by a cost segregation study (even if purchased several years ago).
