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Taxes Information |
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Section 179 - Tax Relief From Depreciation Rules
"Depreciation." For business owners, this word is the one most likely to inspire headaches and fits of cussing. The expanded provisions of Section 179 are just the medicine you need to cure the depreciation blues. Depreciation Traditionally, if your business property had a life of more than one year, the cost had to be deducted over several tax years. The number of years depended on the characteristics of the property, which made depreciation the flag-bearing example of the complexities of the tax code. Shockingly, the federal government has provided substantial relief to business owners. Section 179 of the Internal Revenue Code has been dramatically expanded to the benefit of businesses, particularly small ones. This code allows businesses to completely deduct the cost of tangible property in the year of purchase. The tax relief comes from the expansion of the total amount that can be deducted in one year. Huge Deduction Increase As part of the Job Growth and Reconciliation Act of 2003, the one-year deduction amount was increased from $25,000 to $100,000. The 100,000 figure will be adjusted for inflation each year, which means it will continue to increase. This is very good news. What Property Qualifies? You can deduct the cost of the following property under Section 179: 1. Machinery and equipment 2. Furniture and fixtures 3. Computer software. You must elect Section 179. It is not automatically given to you. Simply fill out IRS Form 4562 and attach to the returns for the business. In Closing As shocking as this will sound, the government should be applauded for expanding Section 179. Small businesses are burdened by too many regulations and mandatory costs. The expansion of Section 179 is a nice piece of tax relief legislation. Let's hope more is on the way. Richard Chapo is CEO of http://www.businesstaxrecovery.com - Obtaining tax refunds for small businesses by finding overlooked tax deductions and credits through a free tax return review.
MORE RESOURCES: Those who oppose higher taxes and are fed up with record levels of U.S. debt may pine for Ronald Reagan, the patron saint of lower taxes and smaller government. WASHINGTON — Raising taxes on the wealthiest Americans, as President Barack Obama proposes to do, probably wouldn't wreck the moribund U.S. economy, but extending the tax cuts they've enjoyed since 2001 could spur some economic benefit. Burnsville council approves 5.6 percent maximum hike after austerity measures in 2010 by John Gessner Thisweek Newspapers In stark contrast with this year’s austerity measures, Burnsville will raise 2011 city taxes by up to 5.6 percent and avoid deep budget cuts next year. The City Council voted 3-2 on Sept. 7 to certify a maximum levy increase of 5.6 [...] Taxes headed back up in 2011 is a post ... Jupiter holds taxes steady, eliminates 8 jobs from budget Property taxes will stay the same for Abilene residents. So many different taxes, and they all keep going up, Gettysburg resident Ken Groff said, shaking his head. Two primary contests for Johnston council and three for School Committee are at stake Sales tax collections – a major source of funding for local governments – are holding strong in Andalusia and the county, the most recent numbers show. The figures, which represent taxes collected in July and remitted in August, are the most recent available. Andalusia showed an approximately 2 percent increase to $364,912, city officials said Thursday. Year-to-date, [...] Capitol Hill employees owed $9.3 million in overdue taxes at the end of last year, a sliver of the $1 billion owed by federal workers nationwide but one with potential political ramifications for members of Congress. United States - Washington DC - Back taxes - Capitol Hill - Neighborhoods Taxes go downSeveral letters have complained about property tax increases. However, we are having the opposite experience: Our home's assessed value decreased by about 30 percent, and our taxes will come down almost 20 percent if no budget change is adopted, and 30 percent if the proposed change is adopted. |
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