Is new equipment for the office on your holiday to-do list? Well, you do not need to wait–you’ll be jumping for joy this tax season thanks to Section 179.
Exactly what is the Section 179 Tax Deduction?
Section 179 permits you to subtract the complete price of any eligiblepermitted devices or software purchased or rented throughout this past year. This means you do not need to wait for holiday sales to kick in, you can take action now to remain competitive and get the devices you require while benefiting your bottom line.
Here’s exactly what is allowed:
Acquired, financed or rented hardware and software
Workstations, laptops, tablets, smartphones
Servers, printers, routers, network switches, network security devices
Off-the-shelf software (productivity, administrative, operating systems, etc.)
Here are a few limitations:
$ 500,000– Maximum overall amount you can deduct of hardware and software purchased in 2017.
$ 200,000– Maximum overall amount you can deduct of rented equipment in 2017.
$ 2M– Maximum overall amount of equipment acquired in 2017 eligible for complete deduction.
Here’s exactly what you need to do:
Purchase, finance or lease the equipment and put it into use by midnight December 31, 2017. Additionally, your purchase must be for company use more than 50 percent of the time.
Here’s how you can make the most of the Section 179 Deduction:
Merely make the purchase and use Form 4562 to claim your deduction.
The complete deduction can be claimed up until you’ve reached $2M in equipment or software purchases.
Previous the $2M point, the deduction decreases on a dollar-for-dollar basis and vanishes once $2.5 M worth of equipment is acquired.
For many situations, applying the tax break will be as simple as deducting the full amount of the purchase as a Section 179 expense; although, in some cases it can be a bit more difficult. For more details about Section 179 or if you require help starting, contact us to request your free, no-obligation Section 179 consultation.