Section 179 Tax Deduction

Write off up to $500,000 in equipment or software purchased OR FINANCED/LEASED in 2011. You can deduct the ENTIRE purchase price from your gross income.

Example

2011 Equipment Purchases: $600,000
First Year Write off:
(Under new law, $500,000 is the maximum Section 179 write-off in 2011)		 $500,000
Bonus First Year Depreciation:
(On remaining value: $600,000-$500,000=$100,000 x 50% = $50,000) 		 $50,000
Normal First Year Depreciation:
(20% depreciation in each of 5 years – $50,000 x 20% = $10,000)		 $10,000
Total First Year Deduction:
($500,000 + $50,000 + $10,000 = $560,000)  		 $560,000
Tax Savings:
(Assume a 35% tax rate. $560,000 x 35% = $196,000)		 $196,000
Actual Equipment Cost:                                                                                 
($600,000 less all tax deductions of $196,000) 		 $404,000

Purchased, Leased or Financed – Qualified!

The obvious advantage of leasing or financing the equipment and/or software from CHASE INDUSTRIES and then taking the Section 179 deduction is the fact that you can deduct the full amount of the equipment cost (up to $500,000), without paying the full amount this year! The amount saved in taxes can actually exceed the payments making this an excellent bottom-line friendly deduction.

2011 is the year! The deduction may be lowered to $25,000 in 2012.

Always make sure you consult with your tax advisor and check out www.section179.org.