In October, we gave a gentle reminder to our sheet metal business readers about the year-end deadline for meeting the requirements to benefit from the Section 179 tax deduction. With December fast approaching, we’d feel guilty if we didn’t issue a reminder again, just in case any of you are running late! There is still sufficient time, in fact, if you don’t delay further.
Here are key facts & figures to spur you into action:
- The deduction limit is $500.000. The spending cap is $2 million.
- The full purchase price of qualifying equipment and software purchased or financed during 2016 can be deducted.
- A bonus depreciation for new equipment after the spending cap reached is 50%.
You’ll get an extra boost with the following special incentive: Section 179 not only provides a purchase amount deduction, but also allows a deduction for equipment leasing or financing. A very attractive option, because the amount deducted will almost always exceed your cash outlay for the year – helping not only with cash flow, but with profits.
So where does sheet metal fit into the total picture? “Significantly” is the answer, based on the expanding range of HVAC equipment that has qualified for Section 179 and meets the standards of the ASHRAE Associate Society Alliance. Strong supporters and 179 advisors are leading industry organizations such as ACCA, AHRI, HARDI, MCAA, PHCC, and SMACNA.
To help you build a list of business equipment that qualifies for 2016, here are the main categories:
- Equipment for Business Use
- Computers and Software, and Office Furniture & Machinery
- Plus this key category: Property attached to a building that is not a structural component of the building.
We hope we have inspired you to beat the Dec. 31 deadline if you haven’t already done so. For a useful head start, here’s a Section 179 Deduction Calculator.
And what better reminder of the need to beat the 2016 year-end deadline than the IRS itself, and its advice on Electing the Section 179 Deduction.
Our best wishes for the holiday season, and a Happy New Tax Year!