Section 179 is a depreciation schedule on steroids.

Have you been enjoying a good year financially with your company? Are you anticipating a higher income tax bill as a result of this good year? If so, you will want to consider investing in new equipment (like a truck body installed by Hostetler Truck Bodies and Trailers for your new or existing vehicle) while taking advantage of Section 179 of the IRS Tax Code.

Section 179 - The Basics

What exactly is Section 179? It’s a provision of the Code that enables businesses to deduct the cost of qualifying equipment purchases directly from their gross income for tax purposes.

Most business owners are very familiar with the various types of depreciation schedules promulgated by the IRS through the years. For instance, a company might invest in a $50,000 machine and then deduct $10,000 each year from gross income for five years when calculating their tax burden.

Now, while it’s true that this is better than no write-off at all, most business owners would really prefer to write off the entire equipment purchase price for the year they buy it.

Section 179 is a depreciation schedule on steroids. In many cases, the FULL AMOUNT of your work vehicle equipment purchase may qualify for a single deduction!

Section 179 - Some Rules

Of course, there are some rules that must be followed:

• Vehicles/equipment must be TANGIBLE and purchased for business use
• Vehicles/equipment must be purchased and placed into service by December 31, 2018 to qualify for this year's tax consideration
• Vehicles/equipment must be acquired from a non-related third party
• Vehicles/equipment must be utilized for business purposes a minimum of 50%

It’s important to consider that many work vehicles will qualify for this deduction because of their configuration (body installation, van upfit with shelving, etc.). Vehicles/equipment can be new or used ("new to you" is the key), and even some passenger vehicles may qualify for certain deductions within this section. The deduction may be taken whether the equipment is purchased, leased, or financed.

Section 179 - Links

For a good introduction to the Section 179 specifics for 2018, check out this Overview by the Section 179 organization. To find out more about Section 179 requirements for vehicles, click here.

If it makes financial sense, why not put your hard-earned money back into your business instead of paying it out in taxes? Section 179 can change each year without notice (Section 179 has even changed mid-year), so it benefits you to take advantage of this generous tax code while it’s available.

[NOTE: At Hostetler Truck Bodies and Trailers, we are not tax professionals or advisors. WE STRONGLY RECOMMEND THAT YOU CONTACT YOUR TAX PROFESSIONAL OR ADVISOR TO DETERMINE HOW SECTION 179 MIGHT IMPACT YOUR COMPANY.]