Tax Incentive For Capital Purchases

It has come to my attention that the tax incentives for capital purchases under Section 179 in the U.S. tax code have been extended through 2010. If you are not familiar with them ask your tax advisor about the specifics. Here are the basics for you now:

1) Businesses showing a profit and who purchase capital equipment totalling up to $250,000 in the 2010 calendar year may accelerate the depreciation of these items at the rate of 100%.

2) Purchases above the $250,000 amount also may be accelerated at the rate of 50% up to $800,000 if purchased in calendar year 2010.

3) Example: A company buys $400,000 in qualifying products. The first $250,000 is 100% deductable.

4) There are different rules for real estate and vehicles. Consult your tax expert for specifics on these and all of the rules.

It may sound unbelievable but the recent tax incentives have even allowed people to buy golf carts and get a 100% tax credit making them free. I know of a couple of people who got them and they ended up in fact being free after their credit. Don't let this opportunity slip by without taking advantage of this great program. The rules even apply to software in most cases so now is a great time to do upgrades.

(This information is for informational purposes only. It is not tax advice. consult your tax expert for advice.)