Buzz continues regarding Section 179 of the tax code, especially since an extension for this provision was approved. Section 179 allows farmers to upgrade, replace or purchase new equipment and write off the full purchase price during the current tax year. The maximum deduction remains at $500,000 for 2014.
With the door left open, even those who purchased a good amount of equipment in recent years to take advantage of the deduction may want to keep shopping for good deals. Those looking to do trade-ins may not see as much benefit if the equipment has been fully depreciated through Section 179 guidelines.
Keep in mind Section 179 is not a permanent tax savings, but an accelerated deduction with limits. A CPA should be able to look at the farm’s records and make recommendations regarding purchases, trade-ins and the general ins and outs of Section 179.
The H&M team is well-versed in Section 179 deductions. Please contact us today for more information.