Phone: 800.326.4188 ext. 222 & 226
Fax: 850.479.3891
Address: 4300 Bayou Blvd. Suite 33
  Pensacola, Florida 32503
  July 23, 2021 HOME   FCC HISTORY   WHY LEASE?   NEWSLETTER   PROGRAMS   CONTACT


Tax Benefits



Typically, if property for business has a useful life of more than one year, the cost must be spread across several tax years as depreciation with a portion of the cost deducted each year.

But there is a way to immediately receive these income tax benefits in one tax year. The provisions of Internal Revenue Code Section 179 allow a sole proprietor, partnership or corporation to fully expense tangible property in the year it is purchased.

And in 2003, tax-law changes made this option much more appealing by dramatically increasing -- from $25,000 to $100,000 -- the amount that can be written off immediately. This law is in effect through year 2007 and includes all depreciable equipment, even off-the-shelf computer software.

 
Before
Section 179
After
Section 179
Equipment Purchase
$45,000
$45,000
1st Year Write-Off
Tax Code 179
$24,000
$45,000
Normal 1st Year Depreciation
(20% based on 5 year asset life)
$4,200
0
Total Deduction
1st Year
$28,200
$45,000
Marginal Tax Rate
(Assumed)
35%
35%
Your Tax Savings
$9,870
$15,750


** Consult your tax advisor regarding IRS Section 179 and all accounting procedures.
For more info see 
http://www.depreciationbonus.org