Maximizing Your IRS Section 179 Tax Deduction: This May be the Best Time

If you’ve been on the fence about purchasing new digital equipment for your practice, this tax incentive might be all the justification you need to make the decision.

Section 179 of the IRS tax code is designed to support small businesses by giving them financial incentive to invest in their business and support the manufacturing sector that serves them. It is also intended to spur economic growth. With Section 179, business owners can deduct the full purchase price of qualifying equipment and/or software purchased or financed during the tax year. For 2016, that means up to $500,000, which is a large increase over previous years and can really make a difference to your bottom line.

2016 Section 179 Deduction
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Financial Benefits of Digital Technology: Section 179 Tax Deduction

If you have been waiting to purchase new digital equipment for your practice, now may the time to act. While panoramic imaging systems, CBCT, intraoral sensors, and CAD/CAM technology all pay for themselves thanks to improved communication and case acceptance, buying your equipment before the end of the year can also provide a number of tax benefits for you as a small business owner. *

The federal government has enacted tax deductions to help small businesses purchase capital equipment and spur economic growth. With Section 179, dental practice owners can write off a certain amount of their purchases upfront, rather than depreciating it over the useful life of the asset. However, this number is subject to change on an annual basis; in fact, as with last year, it was supposed to decrease to just $25,000. Fortunately, a bill calling for a one-year extension on the $500,000 write off was just passed. To ensure that you lock in the best deduction, you may want to look into purchasing your equipment this year, as this amount may decrease in 2015. Continue reading