Depreciation Bonus Information Clearinghouse
At midnight on Dec. 31, 2013 the 50 percent depreciation bonus expired and Sec. 179 expensing levels fell from $500,000 with a $2 million phase-out cap to $25,000 with a $200,000 cap. On Dec. 19, 2013 the Senate rejected legislation that would have continued depreciation bonus and the higher Sec. 179 levels for 2014. At this time, it is unknown when or whether the Senate will vote again on a tax extenders bill.
View the 2013 AED Depreciation
Bonus brochure HERE.
Order additional copies
of the brochure HERE.
American Taxpayer Relief Act
On January 2, 2013 President Obama signed the American Taxpayer Relief Act (H.R. 8) to temporarily avert the "fiscal cliff." Section 331 of the new law extends 50 percent bonus depreciation through 2013. It also increases Sec. 179 expensing levels to $500,000 with a $2 million phase-out for 2012 and 2013.
Additionally, the new law allows companies the option to accelerate AMT credits in lieu of the depreciation bonus and to permit businesses using PCM (percentage of completion method of accounting) to benefit from the capital investment incentive.
Depreciation Bonus At A Glance
Sec. 179 Expensing At A Glance
- The American Taxpayer Relief Act extended 50 percent depreciation bonus through 2013.
- The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 provides 50 percent depreciation bonus for capital investments placed in service after December 31, 2011 and through December 31, 2012.
- Depreciation bonus helps businesses that cut their tax bill buy new equipment.
- Applies, among other things, to purchases of tangible personal property (including construction, mining, forestry, and agricultural equipment) with a MACRS recovery period of 20 years or less
- Applies to new equipment only
- Allowed for both regular and alternative minimum tax purposes
- Discretionary - Taxpayer need not claim the depreciation bonus
- The American Taxpayer Relief Act increases Sec. 179 expensing levels to $500,000 with a $2 million phase-out for 2012 and 2013.
- New and used equipment is eligible for expensing
- Can be combined with depreciation bonus
Keep checking our DepreciationBonus.org Web site for more information.
Please note that the information on this site is provided by the Associated Equipment Distributors as a public service to equipment purchasers. It should not be construed as tax advice or as a promise of potential tax savings or reduced tax liability.
For more information about the depreciation bonus, contact your tax professional or visit the Internal Revenue Service website.
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