Receive your 2024 Section 179 tax deduction savings
Section 179 of the federal tax code has been extended and expanded to allow businesses to deduct the full purchase price of qualifying equipment and/or software from your yearly gross income. In addition, businesses can take advantage of 60% bonus depreciation on both new and used equipment for the entirety of 2024.
This deduction is not automatic and must be elected. In order to elect to take the deduction, you’ll need to fill out Part 1 of IRS form 4562.
2024 Deduction Limit: $1,220,000This deduction is good on new and used machines, machine control, survey equipment, as well as software. Outright purchases and financed purchases qualify. To take the deduction for tax year 2024, the equipment must be financed or purchased and put into service between January 1, 2024 and midnight on December 31, 2024. 2024 Spending Cap on Equipment Purchases: $3,050,000This 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 $4,270,000 on equipment won’t get the deduction.) |
Here’s how Section 179 works:
In years past, when your business bought qualifying equipment, it typically wrote it off a little at a time through depreciation. In other words, if your company spends $50,000 on a machine, it gets to write off (say) $10,000 a year for five years (these numbers are only meant to give you an example).*
Now, while it’s true that this is better than no write-off at all, most business owners would really prefer to write off the entire equipment purchase price for the year they buy it. And that’s exactly what Section 179 does – it allows your business to write off the entire purchase price of qualifying equipment for the current tax year.
*Topcon Solutions does not offer any tax advice, and this information is provided simply as a suggested purchase savings method. Please consult your tax advisor on all Section 179 deduction and bonus depreciation details. Read more about the Section 179 deduction at https://www.section179.org/section_179_deduction/
Commonly asked questions:
What purchases qualify?
This Section 179 tax deduction is good on new and used machines, machine control, survey equipment, as well as software. Outright purchases and financed purchases can qualify.
When do purchases qualify?
Anytime during the year if purchased and put into service by midnight December 31, 2024.
How much can I deduct?
Up to $1,220,000 of the full price of qualified purchases. It's worth noting it depends on how much qualifying equipment and software you purchase and put into use this year.
How do I estimate my savings?
This Section 179 Deduction Calculator for 2024 may very well help in your decision of considering whether or not to purchase or lease equipment in the current tax year.
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