Open Today !
Section 179 Tax Savings
How section 179 can benefit your business
Section 179 of the tax code allows business taxpayers to deduct the cost of certain property as an expense when the property is first placed in servic, including the Mercedes-Benz Sprinter Van. Publication 946 for 2023 outlines the specifics. Previously, businesses would gradually write off the cost of qualifying equipment over several years through depreciation. However, Section 179 simplifies this process by enabling businesses to deduct the entire purchase price of qualifying equipment in the year of purchase.
The Limits and Qualifications of Section 179
Section 179 deduction dollar limits for 2023.
For tax years beginning in 2023, the maximum section 179 expense deduction is $1,160,000. This limit is reduced by the amount by which the cost of section 179 property placed in service during the tax year exceeds $2,890,000.Also, the maximum section 179 expense deduction for sport utility vehicles placed in service in tax years beginning in 2023 is $28,900.
Section 179 deduction dollar limits for 2024.
For tax years beginning in 2024, the maximum section 179 expense deduction is $1,220,000. This limit is reduced by the amount by which the cost of section 179 property placed in service during the tax year exceeds $3,050,000.Also, the maximum section 179 expense deduction for sport utility vehicles placed in service in tax years beginning in 2024 is $30,500.
What Property Can Be Depreciated?
To be depreciable, the property must meet all the following requirements.
- It must be property you own.
- It must be used in your business or income-producing activity.
- It must have a determinable useful life.
- It must be expected to last more than 1 year.
For full details Publication 946 for 2023 outlines the specifics.
*This information does not constitute, nor is it intended to be, legal, tax, financial planning or investment advice and should not be relied upon as such. Federal tax depreciation deductions are subject to change without notice. For more information visit IRS.gov