Leverage the Section 179 tax deduction to save on your equipment and infrastructure needs
Many companies may not realize they can save a significant amount of money on qualified equipment purchases by submitting as a Section 179 deduction in tax returns. For businesses purchasing equipment in 2021, the Section 179 deduction gives a generous incentive to invest in equipment and software to boost efficiency, raise productive capacity, expand products and services, and grow revenue.
What is Tax Section 179?
Section 179 of the United States Internal Revenue Code (26 U.S.C. § 179) allows a taxpayer to elect to deduct the cost of certain types of asset purchases on their income taxes as an expense, rather than requiring the cost of the property to be capitalized and depreciated. There are caps to what you can spend and also equipment that qualifies. Read more about Tax Section 179 and calculate your potential tax savings at the free resource site: www.section179.org
It’s simple to take advantage of the Section 179 deduction:
- Purchase qualifying equipment and software for your company during the tax year, then submit everything during the next tax return.
- Most tangible business equipment qualifies including computer hardware, software, and certain infrastructure improvements.
- The deduction limit for 2021 is $1,050,000 with a total purchase spending cap of $2,620,000 for qualified new and used equipment, plus a 100% bonus depreciation.
- The equipment must be purchased (financed/leased) and put into service between January 1st and December 31st of the current tax year to qualify for the deduction.
What’s the benefit for your business?
If you have old, outdated computers for your employees or simply looking to update and achieve a modern look at your business, then this allows you to do so without a large cost.
In the past, you could write off the money your company spent over the course of, say, five years ($50,000 would be $10,000 a year). With Section 179, you can write it off for the full purchase of the equipment the following tax year! It’s an incredible savings opportunity for businesses to take advantage of.
Don’t Wait – Take Action Now
It’s not too late to plan – make sure you take advantage of Tax Section 179 on all your equipment and property purchases before the year ends!
If you are ready to upgrade your equipment in 2021, reach out to Valeo Networks today to schedule a consultation or onsite visit. We can manage the entire project for you from finding deals on the proper equipment to installing and getting it up and running before the year-end deadline.
Valeo Networks does not provide tax advice. Please check with IRS guidelines or your tax advisor to see if making an asset purchase before year-end will create a tax advantage for your company.