- Equipment (machines, etc) purchased for business use
- Tangible personal property used in business
- Business Vehicles with a gross vehicle weight in excess of 6,000 lbs
- Computers
- Computer Software (off the shelf)
Off-the-shelf computer software. Off-the-shelf computer software placed in service during the tax year is qualifying property for purposes of the section 179 deduction. This is computer software that is readily available for purchase by the general public, is subject to a nonexclusive license, and has not been substantially modified. It includes any program designed to cause a computer to perform a desired function. However, a database or similar item is not considered computer software unless it is in the public domain and is incidental to the operation of otherwise qualifying software.
- Office Furniture
- Office Equipment
- Property attached to your building that is not a structural component of the building (i.e.: a printing press, large manufacturing tools and equipment)
- Partial Business Use (equipment that is purchased for business use and personal use – generally, your deduction will be based on the percentage of time you use the equipment for business purposes.)
Leasing and Section 179
Did you know that your company can lease equipment and still take full advantage of the Section 179 deduction? In fact, leasing equipment with the Section 179 deduction in mind is a preferred financial strategy for many businesses, as it can significantly help with not only cash flow, but with profits as well.
Non-Tax | Capital Lease
The main benefit of a non-tax capital lease is that you can still take full advantage of the Section 179 Deduction, yet make smaller payments. With a non-tax capital lease you can acquire and write off $250,000 worth of equipment this year, without actually spending $250,000 this year. A small business that is managing cash flow can leverage a non-tax capital lease and still take the Section 179 Deduction.
Examples of non-tax capital leases include a $1.00 Buyout, and a 10% Purchase Upon Termination (PUT) Lease. In many cases, the amount you save in taxes will be MORE than the total of your first year’s payments.
Equipment Financing
You may also obtain an equipment loan using an Equipment Finance Agreement (EFA) and still take the Section 179 Deduction.
Find more information at http://www.irs.gov/publications/p946/ch02.html or http://www.section179.org/index.html
