NEWS AND NOTEWORTHY CONTENT
Section 179 Tax Deductions
Section 179 at a Glance for 2023
To take the deduction for tax year 2023, the equipment must be financed or purchased and put into service between January 1, 2023, and the end of the day on December 31, 2023.
This is the maximum amount that can be spent on equipment before the Section 179 Deduction available to your company begins to be reduced on a dollar-for-dollar basis. This spending cap makes Section 179 a true “small business tax incentive” (because larger businesses that spend more than $3.78 million on equipment won’t get the deduction.)
Bonus Depreciation is generally taken after the Section 179 Spending Cap is reached. The Bonus Depreciation is available for both new and used equipment.
Example Calculation
| Truck Purchases | $1,200,000 |
| First Year Write-Off $1,160,000 = 2023 max |
$1,160,000 |
| 80% Bonus First Year Depreciation updated to 80% via ‘Tax Cuts & Job Act |
$32,000 |
| Normal First Year Deduction 20% in each of 5 years on remaining amount |
$0 |
| Cash Savings Deduction x Tax Rate (35%) |
$417,200 |
| Purchase Cost After Tax | $782,800 |
Information provided by section179.org
Calculate your deductions by visiting the Section 179 Deduction Calculator
