section 179

2 Valuable Year-End Tax-Saving Tools for Your Business

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At this time of year, many business owners ask if there’s anything they can do to save tax for the year. Under current tax law, there are two valuable depreciation-related tax breaks that may help your business reduce its 2019 tax liability. To benefit from these deductions, you must buy eligible machinery, equipment, furniture or other assets and place them into service by the end of the tax year. In other words, you can claim a full deduction for 2019 even if you acquire assets and place them in service during the last days of the year.

The Section 179 deduction

Under Section 179, you can deduct (or expense) up to 100% of the cost of qualifying assets in Year 1 instead of depreciating the cost over a number of years. For tax years beginning in 2019, the expensing limit is $1,020,000. The deduction begins to phase out on a dollar-for-dollar basis for 2019 when total asset acquisitions for the year exceed $2,550,000.

Sec. 179 expensing is generally available for most depreciable property (other than buildings) and off-the-shelf computer software. It’s also available for:

  • Qualified improvement property (generally, any interior improvement to a building’s interior, […]
By |December 3rd, 2019|bonus, depreciation, expensing, section 179|0 Comments

How to Treat Your Business Website Costs for Tax Purposes

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These days, most businesses need a website to remain competitive. It’s an easy decision to set one up and maintain it. But determining the proper tax treatment for the costs involved in developing a website isn’t so easy.

That’s because the IRS hasn’t released any official guidance on these costs yet. Consequently, you must apply existing guidance on other costs to the issue of website development costs.

Hardware and software

First, let’s look at the hardware you may need to operate a website. The costs involved fall under the standard rules for depreciable equipment. Specifically, once these assets are up and running, you can deduct 100% of the cost in the first year they’re placed in service (before 2023). This favorable treatment is allowed under the 100% first-year bonus depreciation break.

In later years, you can probably deduct 100% of these costs in the year the assets […]

By |September 24th, 2019|deduction, deductions, section 179|0 Comments

Bonus Depreciation & Section 179 Depreciation Deduction Rules for 2012

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Taxpayers may want to consider making fixed asset purchases before December 31, 2012 to take advantage of two accelerated depreciation options:
1.      Bonus Depreciation: For most qualified property placed into service in between January 1, 2012 and December 1, 2012, the maximum bonus depreciation allowance is 50% of the cost of the property.  Purchasing  new assets that have a useful life of 20 years or less generally qualify for bonus depreciation.  Bonus depreciation amounts are based upon a calendar year.
2.       Section 179:  For tax […]