Now may be the time for your company to purchase equipment and take advantage of the increased limits for Section 179 deduction benefit available under the Tax Cuts and Jobs Act. These incentives may make your purchase more economical, lower your tax liability and potentially conserve working capital for other immediate business needs.
IRS Section 179
Section 179 of the IRS tax Code permits businesses to deduct the full purchase price of qualifying equipment purchased or financed during the tax year, up to $1,000,000 for 2019. Equipment must be purchased and placed into service by December 31 of the year in which the deduction is claimed. This amount is subject to change in upcoming tax years.
2019 Tax Year Limitations of IRS Section 179
IRS Section 179 permits qualifying purchases, up to $1,000,000 to be fully deducted in year one. There is a limit on purchases of $2,500,000 before the Section 179 deduction is reduced on a dollar-for-dollar basis. The Section 179 deduction is no longer available when purchases reach $3,500,000. These amounts are indexed for inflation for tax years beginning after 2018.
Mobile Pro Systems is not an authorized tax advisor. The information provided on IRS Section 179 is informational only and not intended to express a legal view or replace your accounting professional. You must consult your tax advisor, visit www.irs.gov or contact the IRS helpline at 800.829.4933 to confirm if you qualify for this tax benefit.