Purchase new or used equipment and place it into service by 12/31/18*
- Section 179 doubles to $1,000,000 — 100% increase from 2017. Purchase, finance, and/or lease new or used equipment and place it into service by 12/31/2018 to qualify to write off the entire cost of your equipment on your 2018 tax return, up to $1,000,000.
- 100% Bonus Depreciation now also applies to USED equipment — A 50% depreciation increase from last year plus 2018 used equipment purchases are now eligible. Equipment purchases much be new or “new to you,” and purchased and placed in service by 12/31/2018 to qualify.
2018 Section 179 and bonus depreciation example calculation**
| Equipment purchase: | $1,150,000 |
| Section 179 deduction limit | $1,000,000 |
| 100% Bonus first year deduction: | $1,150,000 |
| Normal 1st year depreciation: (20% in each of 5 yrs on remaining account) |
$0 |
| Cash savings on your purchase: ($1,150,000 x 35% tax rate) |
$402,500 |
| Lowered cost of equipment: (after tax savings) |
$747,500 |
*Consult your tax adviser for more details.
**Example of $1,150,000 equipment purchases in 2018.
**Example of $1,150,000 equipment purchases in 2018.
