section 179 tax deduction - earthbend distribution · 2016-11-04 · section 179 tax deduction •...

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 2016 tax year. This means if you purchase qualifying equipment, you can deduct the full cost of that equipment from your gross income. It’s an incentive created by the federal government to encourage companies to buy equipment and invest in their business. Equipment must be purchased and placed into service by midnight on December 31, 2016, so plan now to capitalize on Section 179 for your business! Section 179 Tax Deduction • Companies can expense up to a $500,000 deduction on new or used equipment as well as off-the-shelf- software. • The maximum equipment investment amount eligible for the full $500,000 deduction is $2 million before the Section 179 deduction begins to be reduced on a dollar for dollar basis. This spending cap makes Section 179 a true “small business tax incentive.” Bonus Depreciation • Additional deductions may be available if you qualify for bonus depreciation. • Take an additional write-off of 50% off the undepreciated balance of capital expenditures and depreciable property (new equipment only). • Equipment must be depreciable under the Modified Accelerated Cost Recovery System (MACRS) with a recovery period of 20 years or less. COMPANY NAME | 1234 NORTH ELM STREET | PHONE: (555) 555-1234 EMAIL: [email protected] | WEB: WWW.COMPANYNAME.COM Section 179 Tax Deduction Don’t miss out on valuable tax benefits in 2016! SECTION 179 DEDUCTION AND BONUS DEPRECIATION CALCULATOR (ENTER COST OF EQUIPMENT BELOW) Cost of equipment ($2 million or less) FIRST YEAR WRITE-OFFS • Section 179 • 50% bonus depreciation • Normal first year depreciation* Total first year deduction Potential tax savings in 2016** Equipment cost after tax savings * Based on an expected 7 year asset life ** Tax savings assume a 35% tax rate Please note, this example should not be interpreted as actual accounting results, it is simply provided as a guide. Please consult a tax advisor to determine the tax ramifications of acquiring equipment or software for your business. CALCULATE RESET

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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 2016 tax year. This means if you purchase qualifying equipment, you can deduct the full cost of that equipment from your gross income. It’s an incentive created by the federal government to encourage companies to buy equipment and invest in their business. Equipment must be purchased and placed into service by midnight on December 31, 2016, so plan now to capitalize on Section 179 for your business!

Section 179 Tax Deduction• Companies can expense up to a $500,000 deduction

on new or used equipment as well as off-the-shelf-software.

• The maximum equipment investment amount eligible for the full $500,000 deduction is $2 million before the Section 179 deduction begins to be reduced on a dollar for dollar basis. This spending cap makes Section 179 a true “small business tax incentive.”

Bonus Depreciation• Additional deductions may be available if you

qualify for bonus depreciation.• Take an additional write-off of 50% off the

undepreciated balance of capital expenditures and depreciable property (new equipment only).

• Equipment must be depreciable under the Modified Accelerated Cost Recovery System (MACRS) with a recovery period of 20 years or less.

COMPANY NAME | 1234 NORTH ELM STREET | PHONE: (555) 555-1234EMAIL: [email protected] | WEB: WWW.COMPANYNAME.COM

Section 179Tax DeductionDon’t miss out on valuable tax benefits in 2016!

SECTION 179 DEDUCTION AND BONUS DEPRECIATION CALCULATOR (ENTER COST OF EQUIPMENT BELOW)

Cost of equipment ($2 million or less)

FIRST YEAR WRITE-OFFS

• Section 179

• 50% bonus depreciation

• Normal first year depreciation*

Total first year deduction

Potential tax savings in 2016**

Equipment cost after tax savings

* Based on an expected 7 year asset life** Tax savings assume a 35% tax ratePlease note, this example should not be interpreted as actual accounting results, it is simply provided as a guide. Please consult a tax advisor to determine the tax ramifications of acquiring equipment or software for your business.

CALCULATE RESET

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