Don’t Miss December 31st Deadline to Write Off Up To $250k in Software Purchases!
Business owners who acquire equipment for their business: machinery, computers, and some out-of-the-box software, usually prefer to deduct the cost in a single tax year, rather than a little at a time over a number of years. This deduction is known by its section in the tax code, a Section 179 deduction.
Under Section 179, businesses that spend less than $800,000 a year on qualified equipment may write-off up to $250,000 in 2009. The rules are designed for small companies, so the $250,000 deduction phases out when a business purchases more than $800,000 in one year. (Companies cannot write off more than their taxable income).
A business can save up to $26,000 on a $75,000 software or equipment purchase if it’s done before December 31, 2009 and it meets certain eligibility requirements. So not only would you save money through a tax credit, you would also reap business cost savings from new software that will improve your business performance! That’s an end-of-year savings worth considering.
For more information about Section 179, you should talk to your CPA or accounting advisor.