An online resource that provides ongoing coverage of Section 179 Deduction news announced on Dec. 16 that the Senate has passed the expansion of Section 179 Deduction limits through Dec. 31, 2014, with a 76-16 vote. This comes after the House passed H.R. 5771, the Tax Extenders Bill, back on Dec. 3.
The tax deduction was a part of a $42 billion package of tax incentives, which were set to expire within the next two weeks.
Section 179 of the IRS Tax Code states that businesses can deduct the full purchase price of financed or leased equipment and qualifying off-the-shelf software for the current tax year. In order for items to qualify under the legislation, it must be put into service by the end of 2014.
"As a soybean grower, I welcome this federal tax extension as it provides continuity and stability for my fellow producers who use these programs," Stan Born, soybean farmer from Dunlap, Ill., told the Farm Journal. "However, farming requires long-term planning and, consequently, we need a more permanent solution. I hope that both chambers will work together on a resolution and extend these critical tax incentives into the future."
As the Section 179 news resource reports, the Section 179 Deduction is critical to helping businesses keep more capital while obtaining the equipment, software and vehicles they need.
Some of the property that counts toward the Section 179 Deduction includes computers, office furniture, office equipment, tangible personal property for business, and equipment used for partial business use.
Section 179 has been known to change every year with little notice, meaning the tax break may not be permanent. The IRS has identified certain zones, including the Gulf Opportunity Zone and the New York Liberty Zone, to receive increased Section 179 deductions during this time period.