Tax Incentive for Equipment Purchases

So its been a while since our last post, I know you've missed our insightful banter.  No worries we are back!

If you've been holding off on equipment purchases or leases for a while, now might be the time to finally pull the trigger. You can expense 100% of up to $500,000 worth of purchases for 2011 - meaning that instead of slowly depreciating that purchase over several years, you can deduct the entire expense for the whole tax year if your equipment is purchased and put into service by December 31st.  

Who to thank? IRS Section 179, one of the more straightforward and beneficial tax incentives around for small business. Here's how it works: let's say you're thinking of buying $15,000 of phone equipment. If your business is taxed at 35%, then your new phone equipment will effectively cost only $9,750 if you purchase and install it before the end of the year. These purchases could include phone systems, routers, switches, servers and computers.  

Tax laws change often, and particularly in the past several years, Congress has extended and amended various elements of the tax code to help stimulate business activity. We can't be sure what the tax code will look like at the end of the next year, but we're pretty sure that 2011 is a good year to make a big purchase.  

At Taylored Systems, we're more than happy to make recommendations about how to add new equipment to your office and gain a tax write-off. But we aren't tax advisors, so be sure to consult with a professional who's familiar with your situation.  

For more information about Section 179 and recent legislative changes and extensions to the tax code, visit www.section179.org.

Comments

[Rahat]

That's really good now business owners can find some welcome relief from their annual tax bite when purchasing necessary office equipment..