In late 2015, Congress passed and signed the PATH Act (Protecting Americans from Tax Hikes Act), which also increased the Section 179 deduction cap to $500,000 for 2016. This is great news for businesses, as Section 179 allows you to write off the full cost of technology purchases made during 2016. And as this deduction is only available to businesses whose total technology purchases for the year are less than $2 million, Section 179 is geared perfectly towards small and mid-sized businesses.
Section 179 covers a surprisingly long list of qualifying items, including both new and used hardware, off-the-shelf software, office furniture and equipment, and business vehicles. Even items like personal computers can be included under the “partial business use” category, with some stipulations attached. If you’ve been considering upgrading your workstation computers, or treating your staff to some comfy new office chairs, now is the time.
And by now, we mean immediately. Section 179 has a very firm December 31st, 2016 deadline, and only items purchased, shipped, and installed at your physical location by midnight on December 31st are eligible for this deduction. Any qualifying items need to be in use at your office in order to count towards the Section 179 deduction for this year.
Don’t let the time constrains push you into making hasty choices. Reach out to your IT provider to discuss your options. They can make recommendations that will fit your needs, and help make sure that your purchases will qualify for Section 179. In addition to offering you guidance and advice, they can coordinate with your staff to get your new hardware, software, or equipment up and running before the deadline passes.
Please keep in mind that Praxis Data Systems is an IT provider. While we can offer you our advice, you should direct any questions about the finer points of Section 179 to your CPA or tax attorney.
Want to find out more about how you can take advantage of Section 179 for your business? Contact us at firstname.lastname@example.org or (856) 679-2256. You can also visit the official Section 179 website for more information.