Section 179 Still in Effect Until the end of December!
Section 179, which provides for the immediate expense of qualifying assets, was supposed to expire at the end of 2012. The provision allowed for the immediate write-off of up to $500,000 in assets in 2011, $125,000 in 2012 and down to $25,000 in 2013.
The fiscal cliff deal changed all of that, increasing the limit back to $500,000 for both 2012 and 2013. Similarly, the amount of qualifying assets that can be placed in service before a reduction in the limitation is required has been increased from $500,000 in 2012 and 2013 to $2,000,000 in both years! The new legislation extended this piece of Section 179 for one year. Please see your tax professional to see what “qualifying assets” are included.
While this change obviously came too late to influence any 2012 purchasing, it will provide a nice little bonus come tax time for taxpayers who invested in significant assets during the year, even in the absence of the higher Section 179 incentives.