Did you buy equipment or other business assets during 2015? Here are the current rules for maximizing your tax deduction.
- Section 179. Under code Section 179, you can expense many types of otherwise depreciable property used in your business. Both new and used assets qualify for Section 179.Planning tip: The Section 179 amounts are now permanent. Beginning in 2016, both will be adjusted annually for inflation.
- For 2015, the maximum amount you can expense is $500,000 of the cost of qualifying property you began to use during the year. The $500,000 is reduced when the cost of the property you purchased during the year exceeds $2,000,000. Your deduction may also be limited by the amount of your business income.
- Bonus depreciation. In addition to Section 179, you can benefit from the 50% bonus depreciation deduction for tangible personal property that you purchased and placed in service during 2015. Bonus depreciation is generally available for new assets that have a useful life of 20 years or less.Please contact us about the latest depreciation breaks available to your business.
- Planning tip: The December “extenders” tax law made bonus depreciation available through 2019, though the deductible amount will decrease in 2018 and 2019.