The Tax Cuts and Jobs Act of 2017 provides businesses with additional tax benefits for 2018 and beyond.
- Under Section 179, businesses spending less than $2,500,000.00 a year on qualified equipment may write off up to $1,000,000.00 up front.
- 100% Bonus Depreciation on qualified equipment acquired and placed in service from September 27, 2017 through December 31, 2022. The bonus depreciation now includes used equipment. It falls to 80% in 2023, 60% in 2024, 40% in 2025, 20% in 2026, and expires in 2027.
- The $1,000,000.00 deduction from Section 179 phases out when a business purchases more than $2,500,000.00 in one year.
- Companies cannot write off more than their taxable income.
- The equipment must be placed in service by the end of the tax year.
What does this mean for businesses?
- Capital leases from American Packaging Capital help businesses take advantage of the tax benefits (above) by extending payments out as long as 5 years.
- Tax Savings could be greater than the amount paid in the first year of a capital lease.
Click here to learn more about leasing programs.
Note: Consult with your tax advisors for a clear understanding of how these tax benefits and/or various equipment financing products could impact your specific business.