It’s Good to Have Options

Section 179 has been great to businesses for years. Did you know when it’s combined with equipment financing, it can save you thousands and increase cash flow? Make sure to take advantage of the small business benefits the U.S. government offers, like Section 179.

It’s important to know your options. Asset depreciation might be best to help accelerate current deductions. However, a tax lease can be used as a key tool to manage not only your current, but future deductions as well.

Asset Depreciation

You purchase equipment for $200,000. With that $200,000 in equipment, it typically depreciates, or loses value over its life. A piece of equipment usually has five to seven year lifespan. Normally you divide the cost of that asset by its number of expected years.

Asset Depreciation with Section 179

You can use Section 179 to capitalize the assets and place on the balance sheet, meaning they don’t become an expense for the company. Depreciating assets all in the first year helps to reduce your overall profit, which is the amount you end up paying taxes on. The amount you save may actually exceed the payments, making this a bottom-line friendly deduction.

Asset Expense

With a tax lease, Northland Capital retains ownership and you can expense the payments as a general operating expense. In most cases, the entire lease payment can be fully deductible.

What are my tax savings?

There are some limits. Use this calculator to help determine your Section 179 write off amount and the tax savings it might generate for you. Please consult with your tax advisor to determine the full tax implications and how Section 179 can benefit you.