You could qualify for a
LARGE TAX DEDUCTION
on your next commercial vehicle from Randy Marion Ford Lincoln.
is Section 179?
Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment and/or software purchased or financed during the tax year. That means that if you buy (or lease) a piece of qualifying equipment, you can deduct the full purchase price from your gross income. It's an incentive created by the U.S. government to encourage businesses to buy equipment and invest in themselves.
does it work?
When your business buys certain items of equipment, it typically gets to write them off a little at a time through depreciation. In other words, if your company spends $50,000 on a machine, it gets to write off maybe $10,000 a year for five years. Section 179 allows business owners to write off the entire equipment purchase price for the year they buy it.
Section 179 does come with limits – there are caps to the total amount written off ($1,080,000 for 2022), and limits to the total amount of the equipment purchased ($2,700,000 in 2022). The deduction begins to phase out dollar-for-dollar after $2,700,000 is spent by a given business, so this makes it a true small and medium-sized business deduction.
All businesses that purchase, finance, and/or lease less than $3,780,000 in new or used business equipment during tax year 2022 should qualify for the Section 179 Deduction. Also, to qualify for the Section 179 Deduction, the equipment purchased or financed must be placed into service between January 1, 2022 and December 31, 2022.
IRS Tax Code Section 168(k): you may be able to deduct the cost of your commercial vehicle purchases during the first year of ownership by taking advantage of IRS Code Section 168(k). Remember this potential savings and consult your Tax Professionals to see how you can benefit.