Tax season is here, which means individuals and businesses are busy filling out paperwork to send to the IRS before April 17. With so many codes and forms to keep track of, taxes can feel daunting. This blog will provide a few hints for our customers but in no way serves as a tax rulebook. Let’s look at a common tax deduction for small businesses.
In an effort to encourage small businesses to reinvest in themselves, Section 179 of the tax code allows businesses to deduct the purchase price of some office equipment and software that was acquired during the current tax year, either in buying or leasing. The deduction comes out of your company’s gross income for that year, which can make a major difference for small businesses.
Rather than the typical method of depreciating the equipment over several years, this allows businesses to write off the entire purchase price in one tax season. Why wouldn’t you want to invest in new printers or copiers when you can deduct the cost from your taxes?
As a small business, you can qualify for the Section 179 tax deduction if you purchase, finance, or lease less than $2.5M in new or used office equipment. The one stipulation requires that you only write off up to $1M in your current year’s tax return. For small business expenses, this deduction can make a huge difference.
If you’ve been considering growing your fleet of office equipment, there’s no better time than now to take that step. The purchase or lease could affect your 2018 tax return—in a good way!
From solving printing problems to providing tips on cutting costs through tax deductions, it’s our goal to serve as a resource for all your office needs. If you have specific questions on how Pacific Office Automation can help your small business thrive, reach out to us today.← Back
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