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Year End Tax Savings
December 23, 2010Posted by on
We are all in a festive mood as 2010 draws to a close. Christmas is only a couple days away and New Year only 8 days away. However, for many business owners (myself being one), the business is always on our mind. As business owners we are always looking for ways to make our business more efficient by improving productivity and reducing costs.
One way to reduce cost comes in the form of tax savings – Section 179 from the IRS. According to the recently updated Small Business Jobs and Credit Act of 2010, the Federal Government upgraded a tax deduction, allowing you to buy up to $500,000 in machinery, computers, software, office furniture, vehicles, or other tangible goods and significantly reduce your taxable income on current year’s tax return by treating qualifying equipment as an expense rather than a capital expenditure.
Computer equipment and off-the shelf software fall under this Section 179 category. If you have been waiting to upgrade your firewall, networking equipment, servers and computers then this is the right time to act as you can expense your purchase and realize a significant tax savings. You can use the Tax Savings Calculator to estimate how much you can save on your equipment purchase.
Additionally, many vendors like Cisco, Trend Micro, Wireheadtec and others are offering significant discounts if you purchase hardware and/or software before year end. The vendor discounts coupled with tax savings can add up to be a sizable savings for any business.
Please consult with your tax professional to ensure that your purchase will qualify for the Section 179 tax incentive.
© NetFunction Inc. and Adventures in HIT and BIT, 2010.