100% Bonus Depreciation… while supplies last!
With year end approaching, we felt it would be appropriate to remind our clients of the 100% Bonus Depreciation deduction that is expiring at the end of 2011. For all eligible assets placed in service before December 31, 2011, you may deduct 100% of the cost on your tax return. That is a full, 100% deduction for major equipment, computers, and other business use assets. Bonus Depreciation is not subject to the typical limitations that Section 179 expense is subject to. For instance, Bonus Depreciation can create a loss that can be carried back to prior years to claim a refund. Bonus Depreciation is also not subject to dollar limitations on assets placed in service like the Section 179 deduction is.
One of the biggest benefits for business owners might be that the 100% Bonus Depreciation deduction is not subject to the standard auto depreciation limits for vehicles with a Gross Vehicle Weight Rating (GVWR) of 6,000 lbs or more. Leave it to the government to continue to encourage Americans to drive around in those gas guzzling SUVs! If you are considering upgrading to a new SUV, the time to do it is now! Of course autos are subject to all the usual limitations, and if the vehicle is not used 100% for business, then the personal portion will be non-deductible. Furthermore, the Bonus Depreciation deduction is only eligible for new assets; used assets will not qualify.
If you are thinking of purchasing new equipment or a large SUV by year end (going green may be fashionable but we here at LMGW prefer cold hard cash!) contact your LMGW advisor at once for more details.
ShareThis