Calculate your potential savings with our 2023 Section 179 calculator. Just enter your equipment cost below.1
Tax provisions accelerate depreciation on qualifying equipment, office furniture, technology, software and other business items. Qualifying businesses may deduct a significant portion, up to $1,160,000 in 2023 (to be adjusted for inflation in future years). There is a dollar-for-dollar phase out for purchases over $2.89 million, meaning when purchases are greater than $4.05 million, you will not receive this benefit intended for small to mid-size businesses.
For 2023, bonus depreciation drops to 80% on qualifying assets. Consequently, Section 179 may help bolster your bottom line, enabling you to garner the benefits of new equipment and technology that can help grow your business.
For eligible businesses to capture these tax savings, qualifying property must be placed in service before December 31, 2023. Simply choose your business equipment or technology and Ascentium can design payments to help you make a profitable decision.
Section 179 was created as part of a government stimulus act to encourage small businesses to invest in their growth by providing accelerated depreciation and tax deductions on qualifying business purchases.
For 2023, the maximum amount you may elect to deduct is $1,160,000 on qualifying property purchased and placed into service during the 2023 tax year. If your purchases exceed $2.89 million, the deduction amount will be reduced dollar for dollar equal to the amount over $2.89 million.
If filing for 2022, the maximum amount you may elect to deduct is $1,080,000 on qualifying property purchased and placed into service during the 2022 tax year. If the purchases exceeded $2.7 million, the deduction amount will be reduced dollar for dollar equal to the amount over $2.7 million. Qualifying assets must have been put into service prior to December 31, 2022.
For the 2021 tax year, the maximum amount you could deduct was $1,050,000 on qualifying property. If your purchases exceeded $2.62 million, the deduction amount will be reduced dollar for dollar equal to the amount over $2.62 million. Qualifying assets must have been put into service prior to December 31, 2021.
Bonus depreciation allows qualifying businesses that spend more than the Section 179 limit to depreciate up to 80% on the remaining purchase amount. Bonus depreciation is very useful to companies that spend more than the allowed $2.89 million in a tax year. After Section 179 deductions are taken by a small business, bonus depreciation may be applied to further accelerate depreciation.
Purchases of business equipment, office furniture, computers, software and technology as well as many other business assets qualify for Section 179. Click here for more detail on the assets that may qualify for Section 179 tax deduction.
Yes, for eligible companies, choosing to finance equipment purchases can help organizations save when the finance agreement enables you to take advantage of Section 179! Talk to your tax advisor to determine the type of financing that best suits your company's unique tax needs.
You should consult your tax advisor regarding your Section 179 deduction and the specific impact on your business. The Section 179 calculator above should provide an example of what you could expect your 2023 deduction to be.
If your company and the assets qualify, fill out applicable parts of IRS Form 4562 and include it with your tax filing.
To elect the Section 179 tax deduction, qualifying assets must be purchased and put into service during the tax year for which you are electing the deduction.
1Tax calculation is only an example for illustrative purposes. Bonus depreciation applies to new equipment only. Consult your tax advisor regarding Section 179 and the specific impact on your business.
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