We know you have a lot of things on your mind as we enter the busiest part of the year. Between the Pumpkin pie, finding the perfect gifts for your loved ones and making sure you have the products you need to finish out your company’s year with a bang, keeping up with tax incentives for your business may be the last thing on your mind. That’s why we’re here for you!
The Small Business Jobs and Credit Act of 2010 increases tax incentives on your packaging equipment purchases. The new law increases the limit on expenses to $500,000 with a cap of $2 million. Capital expenditures exceeding $2 million are subject to a dollar-for-dollar phase out of the deduction. The $500,000 deduction under the new law is double the previous deduction limit of $250,000. The $2 million cap on eligible equipment purchases is also a substantial increase from the previous $800,000 limit.
As a business you are allowed to immediately write-off 50% for depreciation on new equipment placed in service during 2010. Normally, this depreciation would be taken over many years. In effect, this allows companies to improve cash flow. All companies can take advantage of the bonus depreciation.
Eligible businesses can take advantage of both of these tax breaks, taking a deduction for the first $500,000 in equipment bought this year, and then the 50 percent bonus depreciation on the rest. Deductions are allowable even if the purchases are wholly or partially financed. This is perfect time to make an investment in your company and your future!
We know you are busy, that’s why we are here to walk with you each step of the way. If you want to make an investment for the future, give us a call and we will help you find the best equipment for your business needs. We can’t be with you to assist in the best gifts for your family, but we are here for this decision. Give us a call and enjoy this season with your loved ones.