After years of constant change- up and down deduction limits, shifting depreciation rates, retroactive measures taken in the following calendar year- 2020 finds the Section 179 tax deduction for capital equipment landing in a place of greater stability. If you have plans for a major equipment purchase in the near future, we’ll explore what you can expect to save this year with Section 179.
Section 179 in 2020
This year’s Section 179 looks an awful lot like it did in 2019 which, if you’ve followed the deduction over the years, is already surprising. Here’s the situation this year:
The deduction limit has risen slightly from $1,000,000 in 2019 to $1,040,000. As long as your equipment is purchased and in service by the end of the day on December 31st, 2020, you qualify to deduct the full amount.
The spending cap has risen slightly from $2,500,000 in 2019 to $2,590,000. Once you hit the spending cap, your deduction will begin to decrease dollar-for-dollar. For example: equipment costing $2,600,000 is 10k over the threshold and would only be allowed to deduct $1,030,000, with another dollar coming off the deduction for every additional dollar spent.
The Bonus Depreciation rate remains static at 100%. Some years there’s no bonus depreciation at all, so to have it carry over at 100% from 2019 is a nice perk for businesses that will be purchasing above the spending cap in 2020.
Calculating Your Savings
As they’ve done for years, the official website of Section 179, www.section179.org features a calculator tool for figuring out how much you can save on an equipment purchase in 2020 when you take advantage of the deduction. If you’re considering a major purchase in the near future, check it out.
If you’re thinking of purchasing a C-Arm, if you’re a small or mid-sized business, Section 179 is in place to help you save thousands (or hundreds of thousands) of dollars on your purchases.
If you’re ready to take advantage of Section 179, our team is ready to help. Please call us at: (800) 643-2998 or Request a Quote!