Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment or software purchased or financed during the tax year. This means that instead of depreciating the equipment over several years, businesses can deduct the entire cost in the year it is placed into service. This deduction is designed to encourage businesses to invest in new equipment and technology.
Take Advantage of Section 179 before the end of the year
Yes! One of the great benefits of Section 179 is that you can finance equipment and still take the full deduction for the purchase price. This means you can deduct the full cost of the equipment in 2024, even if you’re making monthly payments over time. This helps preserve cash flow while still getting the tax benefit.
To take advantage of Section 179 for the 2024 tax year, the digital imaging equipment must be purchased or financed and **placed into service by December 31, 2024. Make sure you plan your purchases early to ensure delivery and installation before the deadline.
Bonus depreciation is another tax incentive that allows businesses to deduct a percentage of the cost of qualifying equipment in the year it is placed into service. For 2024, the bonus depreciation rate is set at **60%**. Unlike Section 179, bonus depreciation can be used even if your business is not profitable, meaning it can create a net operating loss. You can use both Section 179 and bonus depreciation together, starting with Section 179 and then applying bonus depreciation to any remaining costs.