Section 179 Tax Provisions Offer Accelerated Depreciation Schedules

April 2nd, 2009 — Roofing Contractor Info

The Federal Stimulus Package of 2009 earmarks funding for certain construction and green technologies that roofing contractors, if they have not already, should be gearing up to take advantage of.

There are also two tax provisions in the package that any small-to-medium business will benefit from in the form of accelerated depreciation schedules for computer equipment and off-the-shelf software.

Section 179 of the Federal income tax code has been amended with the following incentives to invest in your IT department:

  • You can write off certain expenditures in a single calendar year, instead of depreciating them over a number of years – giving an immediate tax benefit for 2009. Businesses can deduct up to $250,000 for purchases of equipment, including computer hardware and off-the-shelf software, in 2009.
  • To the extent that you cannot take the Section 179 deduction, you may be able to claim a bonus first-year depreciation of 50% of the remainder of the cost of the items purchased.

In order to qualify for the accelerated Section 179 Deduction, the equipment must be purchased or leased and put into service by December 31, 2009.

The tax provisions allow a business to take larger write-offs for the year in which you make your purchases, instead of spreading them out over several years. If there was a time to invest in your computer and software needs, now would be the time. The investments will end up costing you significantly less after factoring in the accelerated benefits.

To get an example of what your tax savings might be, there are Section 179 calculators here and here. Keep in mind that these calculators make certain assumptions and Section 179 does have some requirements to qualify. It is advised that you talk with a financial professional or tax consultant prior to any major purchases.

Online documentation for Section 179 at the IRS website does not appear to be updated yet, but will give you basic information on what types of tangible property are allowed/disallowed, the forms needed for reporting, and other conditions.

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This entry was posted on Thursday, April 2nd, 2009 at 7:49 am and is filed under Roofing Contractor Info. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.


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