Posts Tagged ‘Bonus Depreciation’
Jim Wagoner, CPA | Partner, Director of Tax Services Group
Although bonus first-year depreciation and more-generous Code Sec. 179 expensing limits have been extended before, another lease on life for these tax breaks is far from certain this time around. Unless Congress acts, additional ‘bonus’ depreciation deductions equal to 50% of the adjusted basis of qualified property won’t be available after this year. Also, the Code Sec. 179 expensing limit is set to plummet to $25,000 for property placed in service next year. Thus, businesses planning to purchase machinery and equipment during the remainder of this year or early the next should try to accelerate their buying plans, if doing so makes sound business sense.
Buy Depreciable Property and Place It in Service This Year to Lock in 50% Bonus First-Year Depreciation
Under current law, a 50% bonus first-year depreciation allowance applies to qualified property acquired and placed in service after Dec. 31, 2011 and before Jan. 1, 2013.
The adjusted basis of qualified property is reduced by the additional 50% depreciation deduction before computing the amount otherwise allowable as a depreciation deduction for the tax year and any later tax year.
Many tax breaks currently available to businesses will become unavailable after December 31, 2011. With other political policies taking higher priority, the extension of these tax provisions may not occur. The following article provides detail on tax deductions that are scheduled to expire after 2011.
by Marie Jett, CPA | Manager, Tax Services Group
On September 16 the Senate passed its version of the Small Business Jobs Act of 2010. As of September 21, the House has yet to pass the bill, but the House is expected to pass the bill later this week without modifications, then it heads to the President for signature. We’ll keep you updated on any changes. The following describes a few key features that are in the Senate passed bill. This bill may be called the Small Business Jobs Act, but it affects both large and small businesses, as well as individuals. First, a number of tax law changes in this bill affect depreciable property.