In December 2010, a tax bill was approved for business capital tax deduction. If an asset is acquired and placed in service between September 9th and December 31, 2011, this asset can be fully expensed at the end of the year. This will create a tremendous cash flow advantage since the tax benefit can be recognized immediately instead of an installment each year over the lifetime of the asset. Please note that this only applies to new properties and there is no limit to the purchase amount.
In 2012, the bonus depreciation will be reduced to 50%.
For used assets, section 179 is still available. For 2011, the current law will allow a limit of $500,000 . This will be reduced to $25,000 in 2012.
Again, it’s important to remember that good must be delivered by 12/31/2011 in order to be qualified for the 2011 benefit.
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