2016 Year-end Planning: Section 179 Depreciation

Posted on by Craig Mathias

Source: IRS Publication 946 & Rev Proc 2016-48

With the passage of last year’s PATH Act, many parts of IRC Section 179 were made permanent.  Simply stated, an election can be made to expense most business property placed in service in 2016 (up to $500,000) as long as total property place in service doesn’t exceed $2 million in the year. Most clients are familiar with this rule as it relates to machinery, computers and equipment.  Here are some other areas that may qualify for your business:

  1. Qualified leasehold improvement property
  2. Qualified restaurant property
  3. Qualified retail improvement property

PLEASE CONTACT US TO DISCUSS HOW THESE AREAS APPLY TO YOUR BUSINESS.

Also, know that:

  1. The property has to be place in service during the year but NOT paid for.  Example: A business delivery vehicle purchased in December 2016 where only $500 was placed as a down payment.  The entire purchase price qualifies.
  2. The asset doesn’t need to be new… only new to your business.