This is the time of year when businesses and organizations are constantly thinking about how to spend the rest of their budget. In many cases, if you don’t spend it you lose it. Also, we are all thinking about how we can put 2020 behind us and move on to a safer, happier, and prosperous 2021. Ambind is considering how we can be looking ahead to a more productive new year, and utilizing the Section 179 deduction is one of the tools available to us all. Here is how this tax program works to your benefit.
In the past, many businesses have purchased new or used equipment and written it off as a business expense little by little each year through depreciation. As an example, if you bought a $5000 piece of equipment, you might write off $1000/year over five years. While this method does save business owners some money, wouldn’t it be better if you could write off the entire $5000 purchase or lease up front? That is what Section 179 does. It can lower the real cost of equipment in a substantial way that makes getting something you really need achievable. Assuming a 30% tax bracket, you only end up paying $3500 for that $5000 piece of equipment. And think of the savings for more expensive equipment. A $15,000 purchase at the same tax rate would only really cost you $10,500. You can use this deduction for any tangible equipment, production equipment or machinery, computers, “off the shelf” software, office furniture, business vehicles, and property that is attached to your building that isn’t part of the structure. AND, much of the equipment purchased to combat the spread of COVID-19 will qualify for this deduction. Oh, and yes, this also includes the equipment that you would buy from Ambind Corporation.
While there are some limits to the dollar amount you can deduct ($1,040,000 in 2020), this can be applied to new or used equipment, purchased outright or leased. You can deduct any qualified purchase from January 1, 2020 through December 31, 2020. So, are you looking to upgrade your paper cutter that is old and constantly breaking? Do you want to move on from plastic comb binding and get a new Rhin-o-tuff punch with oval holes for coil binding? Does your office currently use a shredding service that sucks money out every month while not being nearly as secure as having some shredders strategically placed around the building? Now is the time to act! Visit the Ambind website to start searching for the perfect equipment that will propel you into 2021!
It should be noted that while staff members at Ambind Corporation are considered industry experts in print finishing, we are not CPA’s or tax attorneys. We recommend that you consult your accountant for the most detailed information about Section 179. You can also visit www.section179.org for more information, explanations, and guidance.