If you’re thinking about pushing your buying decisions into 2019, consider the benefits of receiving this year’s bonus tax depreciation if you purchase a truck before year-end.
The Tax Cuts and Jobs Act, signed on December 22, 2017, greatly enhanced bonus depreciation opportunities available to businesses in the market to buy equipment. In 2018, taxpayers can elect a 100 percent bonus depreciation deduction under either IRC Section 179 or 168(k).
The PATH Act extends bonus depreciation for qualified property placed in service for the calendar years 2015-2019, subject to a phase-out schedule. When your business typically purchases equipment items, it can write those items off a little at a time through the depreciation. There were two enhancements under 168(k) that were not previously available or within Section 179, which are:
- There is no dollar limit on the amount of property you can purchase that can qualify for the bonus depreciation
- This deduction applies to both new and used equipment
C-Corporation: S-Corporation / Individuals: $1,000,000 Equipment $1,000,000 Equipment x 21% Tax Rate x 37% Tax Rate $210,000 Savings $370,000 Savings
To learn more information about the laws or calculate potential savings, visit: https://goo.gl/bxFLa6
This summary was written to support the promotion or marketing of the matter addressed above, and is not tax advice provided by Murphy-Hoffman Company or MHC Kenworth. The taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.