The Protecting Americans from Tax Hikes Act of 2015 (PATH) was passed!
Your Christmas gift from Congress has arrived!
PATH was passed by Congress on Friday December 18. This Act is expanding the Section 179 deduction limit to $500,000 (retroactively to Jan 1 of 2015). The final step is for President Obama to sign it into law. Although this may take a few days, it’s considered a formality at this point by Washington insiders.
Section 179 will be permanent at the $500,000 level. Businesses exceeding a total of $2 million of purchases in qualifying (new or used) equipment will have the Section 179 deduction phase-out dollar-for-dollar and completely eliminated above $2.5 million. Additionally, the Section 179 cap will be indexed to inflation in $10,000 increments in future years.
50% Bonus Depreciation, aka Section 168, will be extended through 2019. Businesses of all sizes will be able to depreciate 50 percent of the cost of (brand new) equipment acquired and put in service during 2015, 2016 and 2017. Then bonus depreciation will phase down to 40 percent in 2018 and 30 percent in 2019.
The Act gives businesses additional incentive to purchase before year-end, as they can expense larger amounts against 2015 income than previously possible. If Section 168 and/or 179 aren’t a perfect fit, perhaps Section 1031 is an ideal alternative! In that case, EquipEx is here to provide information and help however possible.
Only 2 weeks left of 2015!
Call us for a free consultation. You’ve got one more chance to save $$$ this year and free up some capital for 2016.