| Section 179 - 4th Qtr Tax Saving Strategy for Small | | | | Qualified equipment is defined in IRS Publication 946 |
| Business | | | | and includes such common and movable tangible |
| Sean Marten - Senior Credit Analyst, Crest Capital - 10 | | | | property as all kinds of machinery and equipment, as |
| 25/2007 | | | | well as office furniture, computers, printers, software |
| Use the power of available deductions to boost your | | | | and most vehicles. Used equipment purchased from |
| business's bottom line in 2007. Purchase new or "new | | | | another party - but not from a company that is also |
| to you" used business equipment now. Then place it in | | | | owned by you - can also qualify. |
| service by December 31st to realize exceptional tax | | | | What if I spend more than $500,000? If your business |
| savings. | | | | spends more than $500,000 on business equipment |
| IRC Section 179 - What is it? Under the provision of | | | | this year, you can still leverage a tax savings. Each |
| Internal Revenue Code Section 179, a business that | | | | dollar over $500,000 you spend, however, reduces the |
| spends less than $500,000 this year on qualified | | | | maximum Section 179 deduction by a dollar. For |
| tangible property in 2007 may deduct the total cost of | | | | example, if you spend $550,000, your maximum |
| those assets, up to $125,000. Input the cost of the | | | | deduction for 2007 would be reduced by $50,000. This |
| equipment that you're considering in the instant Section | | | | still allows you to deduct up to $75,000 of the cost of |
| 179 Allowance Calculator to find out the potential cash | | | | your new equipment in the first year. |
| savings. | | | | Note: The allowable deduction amount cannot reduce |
| Designed as an incentive for economic growth for | | | | taxable income below zero. The remaining value of |
| small to medium sized businesses, Section 179 allows | | | | your business equipment can still be depreciated over |
| you to expense the purchase price of your qualified | | | | the prescribed recovery period. |
| equipment immediately upon putting it into service. So, | | | | What's the next step toward tax savings? Action now |
| you see significant tax savings now, rather than | | | | will ensure the benefits of this tax opportunity to your |
| depreciating your newly acquired assets over five or | | | | 2007 business position. Purchase and place into |
| more years. | | | | service needed equipment before December 31st to |
| What Tangible Property Qualifies? Most new business | | | | maximize your deductibles. IRC Section 179 deductions |
| equipment will fall under the rule of Section 179. | | | | can pave the path to significant tax savings in 2007. |