Section 179 for Businesses in 2017: Making Government Stimulus Work for You
By weldadmin | November 01, 2017
If you’re a small business owner who regularly purchases equipment to serve your business needs, you may want to look into taking advantage of the Section 179 tax code by the end of the year. Section 179 was created to help businesses and grow the economy through promoting the financing, leasing, and purchasing of equipment. The year is drawing to a close, and it’s time to start thinking about how to close out your business expenses Here’s what you need to know:
What is Section 179?
Section 179 is a part of the IRS Tax Code that allows businesses to deduct the full purchase price of equipment and software over the tax year. This gives small business owners the chance to reduce their expenditure on equipment and put more money into their business and ultimately the economy as a whole.
How does Section 179 work?
Each year, the IRS decides on an amount of equipment expenditures that each business will be allowed to write off when filing their taxes. Business owners track their relevant expenditures and are then able to receive a tax deduction for any applicable equipment purchases when filing taxes by filling out Part 1 of IRS Form 4562. All equipment must have been purchased by the last day of the preceding year (so, 12/31/2016 for this upcoming year).
Why is it important to me?
Section 179 is one of the most helpful tax codes for small businesses. By allowing businesses to reduce the cost of useful equipment, this tax code incentivizes business owners putting money into their business. This is a part of the government’s plan to stimulate the economy and promote job creation, and it is certainly worth the extra tax form!
You can check out what your potential savings will be by using this Section 179 Deduction calculator.
What equipment is covered?
There are many types of properties that qualify for this tax deduction, and the wide range covers a lot of what a small business needs to thrive. Such properties include:
- Equipment and machines purchased for the business
- Vehicles with a gross weight of >6,000 lbs
- Computers + New Software
- Office equipment and furniture
- Large manufacturing equipment and tools
- And more
A full list of qualifying properties can be found here.
If you are interested in using this as an option for your business expense writeoffs, make sure that you have all documentation of your business equipment for the year, or look into purchasing equipment that you might have been putting off purchasing due to the high price point.
If you have any questions about what this deduction might look like when purchasing a piece of Miller Weldmaster equipment, contact us today!
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