2013 Tax Benefits on POS Equipment

2013

Learn How You Can Save Money on POS Purchases in 2013

Businesses have significant reasons to acquire and install capital equipment before the end of 2013, thanks to the American Taxpayer Relief Act of 2012. And, because the allowable Section 179 deduction is expected to be reduced to $25,000 in 2014 and Bonus Depreciation is scheduled to expire, it’s important to plan now to maximize these important benefits in 2013.

Highlights for Tax Benefits

  • The allowable Section 179 deduction has been increased to $500,000 on the cost of new and use equipment purchased through 12/31/2013
  • Allows a 50% bonus depreciation of the cost of new equipment (under certain conditions) through 12/31/2013

Section 179 Deduction

For 2013, companies can expense up to $500,000 as a deduction as long as total purchases do not exceed $2.5 million.

  • Applies to new and used equipment
  • Can be combined with bonus depreciation
  • The maximum qualified equipment investment amount that is eligible for the full $500,000 deduction in 2013 is $2 million
  • Beyond the $2 million maximum equipment investment threshold, there is a dollar for dollar phase-out of the Section 179 deduction
  • Equipment acquisitions exceeding $2.5 million are not eligible for any Section 179 deduction
  • $1 buyout lease qualifies for Section 179 benefits

Case Study

XYZ LLC operates their business on a calendar tax year and finances a $10,000 POS system for 36 months.

The installation is finished and the job funds November 15th. They make their December Payment ($335). They are now eligible to write off the full $10,000 capital investment for the 2013 fiscal year. At their 35% corporate income tax rate, they will receive a $3,500 tax savings. That is enough to cover 10 months of the lease before the installation starts costing them net money!

The end of the year is approaching, and there’s no better time to invest in new POS equipment for your business! Contact LionWise today to learn how you can save big on POS equipment in 2013.

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