Calabasas, CA (PRWEB) November 08, 2012
With great uncertainty regarding the “fiscal cliff” of spending cuts and tax code revisions due to occur in 2013 unless Congress acts by year end, many businesses are assessing whether they should invest now in plant and or equipment. According to Mike Lockwood, president of TEQlease Capital, a nationwide provider of equipment lease financing solutions, businesses need to be careful not to overreact to the fiscal cliff warnings, and need to determine how potential federal tax changes might affect their small business depreciation deductions including Section 179.
Section 179 of the IRS Code was enacted to help small businesses take a depreciation deduction for capital expenditures in one year, rather than depreciating them over a longer period of time. By taking the full deduction for the cost of the asset immediately, rather than being required to spread out the deduction over the asset's useful life, businesses can realize a substantial tax savings.
As Section 179 presently stands, businesses can deduct up to $139,000 of the cost of qualifying new and used business equipment placed in service in 2012. The deduction is scheduled to drop significantly to just $25,000 in 2013 unless Congress intervenes. In 2011, the deduction was $500,000 of qualifying new and used assets.
Lockwood recommends that businesses consider the following before making any year end equipment decisions.
“It never makes sense to base important decisions such as a business expansion or the acquisition of new equipment exclusively on tax incentives,” explained Lockwood. “Instead we recommend businesses weigh anticipated efficiencies, whether competitors have gained an advantage with newer equipment, and the availability of equipment with added capabilities as factors which are drivers for acquiring equipment.”
TEQlease Capital is a nationwide provider of equipment lease financing solutions across all industries, including manufacturing, education, distribution, financial services, healthcare, and retail organizations. TEQlease Capital customers include Fortune 500, medium-sized, and small businesses. Founded in 2000, the company is based in Calabasas, California. For more information visit http://teqlease.com/, call 1-818-222-1006, or email sales(at)teqlease(dot)com.
TEQlease Capital and TEQlease are trademarks, registered trademarks, or service marks of TEQlease, Inc. All other trademarks are the property of their registered owners.