Section 179

This presentation was featured as a joint webinar between Puryear IT and Certified Lease & Financial Professionals at Great America Financial Services discussing the Advantages of Section 179 IRS Tax Code for your business.

The concept of Section 179 allows you to add the solution that your business needs by acquiring the technology it needs all the while reducing taxable income. For example if you need to upgrade your phone system, your computer system, your software, your PC’s, or disaster recovery - it allows you to do that because it's an economic stimulus that's going to give you a tax savings which is very significant.

A few of the obvious advantages of Section 179 are as follows:

  • Lease equipment on a $1 buyout.
  • Deduct the full amount of the asset (up to $25,000).
  • Only pay a year’s worth of payments.
  • The amount you save in taxes can actually exceed the payments which makes for a very bottom-line friendly deduction.

The webinar demonstrated the following scenario of how the Section 179 process works:

  • Equipment cost = $25,000
  • $25,000 x rate factor .03087 for 3 years = monthly payment of $771.75
  • Year one Section 179 deduction = $25,000
  • Year one total payments (12x$771.75) = $9,261
  • You are depreciating $25,000 but only paying $9,261 so you are deducting over what you paid out significantly reducing your tax burden and taxable income!

The webinar featured many interesting questions and answers from attendees in regard to Section 179: