Most people think the Section 179 tax deduction is some mysterious or complicated tax code. It really isn’t and it can help you add new Bobcat equipment to your fleet. Of course, the equipment must be purchased and put into service before the ball drops in Times Square. We suggest you act quickly.
Essentially, Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment purchased or financed during the tax year. When you buy or lease a Bobcat or other qualifying equipment, you can deduct the full purchase price from your gross income. It’s an incentive created by the U.S. government to encourage businesses to reinvest in themselves.
The Section 179 deduction limit for 2022 is $1,080,000. Your company can deduct the full cost of qualifying equipment (new or used), up to $1.08M from your 2022 taxable income. This deduction is good until you reach $2.7 million in purchases for the year.
Section 179 helps small and mid-sized companies reinvest in their businesses. The full $1.08M deduction can be claimed up to the $2.7M equipment purchases limit. Once that number is reached, the Section 179 deduction decreases dollar-for-dollar and reaches zero once $3,670,000 worth of equipment is purchased/financed.
The Section 179 deduction has proven wildly popular with small and mid-sized companies. But there is a deadline. The equipment must be purchased/financed and put into service by 11:59 pm on December 31st, 2022.
We recommend that you plan ahead and order your equipment soon so you can take delivery by the end of the year. Of course, we also recommend that you consult with your financial advisor or tax attorney.
