Section 179 Deduction Update

Congress has signed and approved a permanent extension to the Section 179 deduction. Moving forward, businesses can now immediately depreciate up to $500,000 in the year they purchased the assets, instead of over a specific period of time. This deduction is good on new and used equipment, as well as off-the-shelf software. This limit is only good for 2015, and the equipment must be financed/purchased and put into service by the end of the day, 12/31/2015. 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 that if you buy (or lease) a piece of qualifying equipment, you can deduct the full purchase price from your gross income. Section 179 does come with limits - there are caps to the total amount written off ($500,000 for 2015), and limits to the total amount of the equipment purchased ($2,000,000 in 2015). The deduction begins to phase out dollar-for-dollar after $2,000,000 is spent by a given business, so this makes it a true small and medium-sized business deduction. Congress has also agreed to extend the 50% Bonus Depreciation through 2019.  SGIA will continue to monitor this activity.  Sign up to receive the most up-to-date regulatory and legislative information about specialty imaging.