Now is the time that business owners and financial executives meet with their CPAs to evaluate their company’s tax position and plan next year’s budget.
Typically, information technology is one of the largest annual investments a business makes. At a time when cost reduction is the number one priority among businesses, here are a couple tax deductions and special offerings that will help companies find extra cost savings this year.
Save Money Through Tax Deductions
In 2010 the federal government updated the Section 179 Deduction, a tax credit that allows businesses to accelerate their deductions for depreciation. Under Section 179, businesses can fully write off their acquisitions made during that tax year.
Businesses can buy or lease up to $500,000 in machinery, computers, software, office furniture, vehicles, or other tangible goods, and depreciate it at one time. Normal depreciation requires a business to depreciate assets over a period of time, but with Section 179 you can take the full deduction in the same year it was purchased. For small businesses this deduction is especially useful because it helps them improve cash flow and lower their tax burden.