Tag Archives: IRS

government

Section 179- President Signs Tax Extenders Bill

Posted: 12/21/15

On Friday December 18, President Obama Signed the $1.8 Spending and Tax Bill Into Law.  Earlier on Friday, the Senate gave final congressional approval to the bill, which includes nearly $700 billion in tax breaks.

The legislation extends more than 50 expiring tax cuts, with more than 20 becoming permanent, including increasing the maximum amount for small business expensing under IRS section 179 to $500,000.  This would be reduced if the cost of section 179 property placed in service exceeds $2 Million.

The new permanent Section 179 expensing limit allows a business to take a current year deduction of the full purchase amount up to $500,000 for assets under $2 Million.


 

Posted: 12/18/2015

Increased Expensing Passes/Made Permanent

The Senate has now done its part and passed a year end budget deal that funds the U.S. government through September 2016, avoiding a shut down.  This was combined with a package of tax breaks providing much needed tax benefits to a broad spectrum of small businesses.  The bill now heads to the President for his signature, which the White House indicates he will sign.

The legislation extends more than 50 expiring tax cuts, with more than 20 becoming permanent, including increasing the maximum amount for small business expensing under IRS section 179 to $500,000.  This would be reduced if the cost of section 179 property placed in service exceeds $2 Million.

The new permanent Section 179 expensing limit allows a business to take a current year deduction of the full purchase amount up to $500,000 for assets under $2 Million.

Example Savings*

Original Equipment Cost:                  $500,000

New Potential Tax Savings:               $175,000

Final Equipment Cost:                       $325,000

  Cash Savings on

Equipment Purchase:                        $175,000

*Assuming a 35% tax qualifying purchase

This information does not constitute tax advice, please check with your tax advisor on how this applies to your business.


 

Posted: 12:18/15

$500,000 Expensing Limit One Step Closer

Today, the House of Representatives passed a $1.1 trillion dollar spending bill to keep government agencies open.

The bill now goes to the Senate, where it will be combined with a package of tax breaks which passed late yesterday afternoon, one of which is the permanent increase of the expensing limit of IRS Section 179. 

The Senate will then take up the combined package in a series of procedural steps and a final vote expected by early Friday (12/18/15) afternoon.

The White House has reported that President Barack Obama would sign the measure into law.



Posted: 12/17/15

THE SECTION 179 ROLLER COASTER MAY BE COMING TO AN END

“The House is set to vote this week on Speaker of the House, Paul Ryan’s sweeping $1.6 Trillion dollar budget deal.  If the current bill (H.R. 2029 Protecting America from Tax Hikes Act of 2015) passes, the yearly battle to get increased expensing limits under the IRS section 179 will finally be over.  The bill will permanently raise the limit to $500,000.

If the bill passes, it will not only increase expensing limits, but there are a number of other provisions that will be beneficial to MDNA Members and small businesses.” —MDNA Executive Vice President Mark J. Robinson

government

The current language in the bill reads:

SEC. 124. EXTENSION AND MODIFICATION OF INCREASED EXPENSING LIMITATIONS AND TREATMENT OF CERTAIN REAL PROPERTY AS SECTION 179 PROPERTY.

(a) Made permanent.—

(1) DOLLAR LIMITATION.—Section 179(b)(1) is amended by striking “shall not exceed—” and all that follows and inserting “shall not exceed $500,000.”.

(2) REDUCTION IN LIMITATION.—Section 179(b)(2) is amended by striking “exceeds—” and all that follows and inserting “exceeds $2,000,000.”.

Read the full bill here