IRS Section 179 Tax Deduction For Capital Equipment

For tax year 2009, many small businesses are able to deduct up to $250,000 of purchased equipment and software as soon as these items are put to work under the Section 179 depreciation provisions. Both new and used assets are eligible. There was however an investment limitation of $800,000. Said limitation was reduced dollar for dollar by the cost of the property placed in service in excess of the investment limitation. To take advantage of the $250,000 allowance, the assets must be purchased in the 2009 tax year.

For taxable years beginning 2010, the Section 179 expense limit was reduced to $134,000, and the maximum deductible expense must be reduced dollar for dollar for investments of more than $530,000 in qualifying property. 

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Click here to read more about Section 179 from the IRS or use LeaseIT’s Section 179 Tax Deduction Calculator.


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