The clock is ticking! Have you checked with your accountant about Section 179 tax deductions for office equipment purchased in 2012? Section 179 is perhaps one of the most beneficial small business tax deductions included in various Stimulus Acts over the past few years, yet many businesses are missing out on its real benefits.
Suppose your business purchases or leases $100,000 worth of new or used office equipment this year. Prior to Section 179, you could only write off only a fraction of this amount annually (say, $20,000 a year for 5 years). Now, through Section 179, you can write off the entire office equipment purchase price for the tax year you buy it in.
Reduce Office Equipment Costs with Section 179 Tax Deductions
Office Equipment Purchase
|Without Section 179 20% depreciation/ 5 years||With Section 179Section 179 Tax Deduction|
|First Year Write Off||$20,000||$100,000|
(Assume 35% tax rate)
|Total Equipment Cost:
($100k less tax deduction)
Obviously, writing the total office equipment cost off up front is $28,000 more beneficial than writing just a small portion every year— over time:
Section 179 of the IRS code was legislated to provide tax relief for your business. Section 179 was even enhanced for 2011 so there is simply no better time than now to take advantage of these excellent tax deductions. All you need to do is to take action while it lasts! And what better way to make the most of your tax deductions than securing an improved office workflow and acquiring cost-saving office equipment and office technology print solutions?
Well, firstly, Section 179 isn’t automatic. If you want to take the deduction, you must elect to do so and consult with your accountant before filing your tax return for the year. You can only use your 179 deductions for the tax year your business purchased or leased the property and placed it into service.
Secondly, most business owners still find Section 179 complicated and are somewhat doubtful about this tax deduction when it is, in fact, very simple to use. All you need to do is buy (or lease) the equipment, and use a special IRS form. Just make sure you keep complete records of the office equipment you leased or purchased during the year.
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Call Officia today for a free document workflow analysis and money saving solutions that will help you – Make a Great Impression.
*For most small businesses (office equipment expenses totaling less than $500,000), the entire cost of office technology can be written-off on the 2011 tax return. For large businesses adding even more than $500,000, the write-offs are just as substantial.