If you haven’t yet heard, you have a new 2014 small business stimulus.
Congress has extended the Section 179 Deduction, allowing you to write off more on your taxes for 2014. This is good news… but you only have a limited time to take advantage of the credit.
How it works
Normally, you have to make purchase deductions using depreciation, but Congress has voted to extend the Section 179 Deduction through 2014, meaning that you can spend $500,000 on business equipment or “off-the-shelf software” this year, and deduct the whole amount from this years’ taxes.
Actually, there’s even better news. You can spend up to $2,000,000 on new or used business equipment or software, and then deduct $500,000.
Although the Section 179 Deduction was retroactively applied, empowering you to deduct equipment and software purchases you made throughout the year (though the bill was just passed a few days ago), you do have to make sure that you finance or purchase your equipment / software and install it before midnight on December 31, 2014.
Will this be available for 2015?
Right now, the answer to that is no. Congress passed an extension on this tax credit (which usually means that they will renew it, depending on the economy’s needs)… but we can’t say definitively at this point that this stimulus will be available for 2015. Plus, if this year is any indicator, it’s highly possible that we won’t find out if the Section 179 Deduction has been extended until next December.
What you should do
If your business made large profits this year, first off: you should congratulate yourself. Clearly, you rock. After you’ve done that, you should consider making some purchases that will improve your speed and efficiency for 2015, enabling you to increase those profits even further and grow your business in leaps and bounds. Buy and install those purchases within the next week and a half (it expires December 31, 2014), then call up accounting to make your deductions.
Want to know how you can improve your business in 2015?
Contact the experts at SWK Tech to learn how you can increase your productivity, improve your supply-chain visibility, and simplify your business accounting processes. Get in touch when you click the button below.