Internal Revenue Code Section 179 has been around since the 1980s but the great news from the new tax law is that the maximum expense amount per year increases to $1,000,000. Newly qualified assets include depreciable tangible personal property used predominantly to furnish lodging, or in connection with furnishing lodging, any facility where sleeping accommodations are rented your HomeAway landlords!
Other newly qualified improvements to existing non-residential real property include:
Roofs, heating, ventilation, and air-conditioning, fire protection and alarm systems, security systems.
As a reminder, Section 179 is normally available for assets in the 3, 5, 7 and 10-year life categories (there are some exceptions). Be careful though, bonus depreciation (a separate blog to follow) rules are the norm and Section179 requires an election on your tax return.
There are limits of an income requirement and by a dollar maximum and it’s recaptured if the business use percentage drops to less than 50%. We see Section 179 as preferable to bonus depreciation for small business because of the ability to specifically determine the amount rather than utilize the “all or none” approach of the bonus system.
Do you need an extension to file tax returns? Czarnowski & Beer is currently offering a complimentary, no-obligation tax return evaluation. To take advantage of this limited time offer, visit our tax return offer page or contact us at firstname.lastname@example.org or call (212) 397-2970 and we will be happy to help you and answer your questions.
Please note, this offer is subject to change or expire without notice on or before October 15, 2018. Please confirm with Czarnowski & Beer if you are reading this blog post after this date. Thank you.