Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment and/or software purchased or financed during the tax year. That means if you buy (or lease) a piece of qualifying equipment, you can deduct the FULL PURCHASE PRICE from your gross income. It’s an incentive created by the U.S. government to encourage businesses to buy equipment and invest in themselves. If you’re considering the purchase of something like a new business telephone system, here is a fantastic incentive to help with that purchase!
Section 179 is really very simple. You buy, finance or lease qualifying equipment and/or software, and then take a full tax deduction on it this year (also, there are a few other things, which we’ll go over, but in a nutshell, that’s the idea). To give you an estimate of how much money you can save, here’s a Section 179 Deduction Calculator to make computing Section 179 deductions simple.
If you use the calculator, take note of the savings on your tax obligation. Many people find that, if they lease or finance their Section 179 qualified equipment, the tax savings actually exceed the first year’s payments on the equipment (making buying equipment profitable for the current tax year). This is perfectly legal, and a good example of the incentive that Section 179 provides small and medium businesses.
To view full details & qualifying purchases of the program, visit the Section 179 Deduction website.
A calculator to help customers see their potential financial savings is available on Section179.org.
