UNDERSTANDING SECTION 179

Understanding Section 179 is crucial for businesses looking to thrive, and Haro is here to be your supportive partner in navigating this valuable tax incentive. By leveraging Section 179, you can make informed financial decisions. We advise our clients on financing solutions that are designed to align seamlessly with Section 179, allowing you to maximize your benefits while efficiently acquiring the equipment you need. 

Section 179 is designed to help businesses by allowing them to deduct the full purchase price of qualifying equipment and software purchased or financed during the tax year. Here’s how it can help businesses:

• Immediate Expense Deduction

Instead of depreciating assets over several years, Section 179 allows businesses to write off the entire cost of qualifying equipment in the year it was purchased. This can significantly lower taxable income for that year.

• Cash Flow Benefits

By deducting the cost of equipment upfront, businesses can retain more cash that they can reinvest in operations, hire staff, or pay down debt. This is especially beneficial for small businesses that need to manage liquidity.

• Encouragement for Investment

Section 179 incentivizes businesses to invest in new equipment and technology. Since the deduction is based on the purchase price, businesses are encouraged to upgrade or expand, enhancing productivity and competitiveness.

• Annual Deduction Limits

For 2024, the deduction limit is $1,220,000, with a spending cap on equipment purchases set at $3,050,000. These amounts can change year by year due to inflation adjustments, making it important for businesses to keep up with current limits.

• Bonus Depreciation

Section 179 works in conjunction with bonus depreciation, which allows businesses to depreciate a percentage of qualifying assets beyond the Section 179 limit.

• Flexibility

Businesses can choose how much of the deduction to apply under Section 179. For instance, if a company wants to reduce its taxable income by a specific amount, it can adjust the Section 179 deduction accordingly.

Don’t let the Section 179 deduction pass you by. Contact Haro today and let us help you save money on your taxes in 2024.

For more details on limits and qualifying equipment, as well as Section 179 Qualified Financing, please read the entire Section 179 website carefully.