Tax Incentives

Did you know small businesses may write-off up to $500,000 for capital expenditures?

Business owners usually prefer to deduct equipment cost in a single tax year, rather than a little at a time over a number of years. This deduction is known by its section in the tax code, a Section 179 deduction.

Under Section 179, businesses that spend less than $2,000,000 a year on qualified equipment may write-off up to $500,000 in 2010 and 2011. The rules are designed for small companies, so the $500,000 deduction phases out when a business purchases more than $2,000,000 of equipment in one year. (Companies cannot write off more than their taxable income).

Virtually all retail and commercial petroleum equipment qualifies for a Section 179 deduction of up to $500,000.

Section 179 Expensing

• $500K expensing for 2010-2011 purchases
• Phase out dollar for dollar when purchases exceed $2,000,000
• Property can be new or used
• Property must be placed in service by December 31, 2010 to qualify for 2010 tax savings, or December 31, 2011 for 2011 tax savings. 

Reminder: to take advantage of the tax incentives, your business equipment must be put in use by year-end. You should contact your tax advisor to learn about the specific impact to your business. Interested in learning more? We’ll provide you with a free consultation and extend finance solutions so you can acquire the business equipment you need. Contact us today at 877.527.0383.