Taxes in the US are notably complicated.[1] In some ways, this is frustrating. But business owners should understand that there are plenty of incentives buried in the almost 7,000 pages of current tax code: that’s one reason it’s so long.[2] Section 179 is one of the most interesting tax incentives available, because it encourages investment, expansion, and improvement.[3][4]
When businesses purchase equipment, they can handle it in two ways for tax purposes.[3] The first is by capitalizing it, and then depreciating it year by year when they do their taxes.[3] The second is by using Section 179 to deduct the cost of equipment fully.[3] For the year 2022, this deduction has an upper limit of $1,080,000.[3] Section 179 is designed specifically to help early-stage and small businesses.[3]
Section 179 is a great option for businesses that are going through an expansion or rebuilding phase.[3] This deduction makes it possible for a business to limit tax liability while also improving equipment. A small business can, for instance, upgrade their vehicles and take the deduction under Section 179. They’ll also likely benefit from improved technology in the updated vehicle. Newer vehicles tend to offer better gas mileage, lower emissions, and improved safety features, too. That means additional benefits to workers, business owners, and the community generally.
Section 179 is a great fit for our customers at Alliance. That’s another great thing about Section 179: it’s available for financed equipment.[3] That means we can help you access this way to limit your tax liability for 2022. Our financing is unique. Your personal credit score doesn’t come into play. We report only to business credit bureaus. And unlike banks, we’re also able to finance soft costs like installation of equipment.[4]
Over the years, we’ve financed equipment for dry cleaners, landscapers, movers, the food industry and more.[4] If you need to access business equipment, contact us today. We have over three decades of experience in this field. We work with everyone from start-ups to long established businesses.[4] We’d love to help you, too.
[1]https://fortune.com/2021/05/20/tax-deductions-file-government-spending-income/
[2]https://www.yahoo.com/lifestyle/u-tax-code-filled-complexities-222836234.html