Annual Tax Updates

Section 179 Limits - Depreciating Assets

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 Bonus Depreciation

de-pre-ci-a tion //noun



1. A system of accounting which aims to distribute the cost or other basic value of tangible capital assets, less salvage (if any), over the estimated useful life of the unit


Section 179 Deductions for Heavy SUVs

Heavy SUVs are defined as those with a gross vehicle rating (GVWR) between 6,001 and 14,000 pounds. For the 2023 tax year, the maximum depreciation deduction is $28,900. For the 2024 tax year, that limit increases to $30,500.

 

For 2023, the Section 179 deduction limit is $1,160,000. However, there is a limit to how much eligible equipment a business can purchase. An entity that places more than $2,890,000 of property in service during the tax year will see the maximum deduction gradually phased out by the amount in excess of that cap. 

For 2023, businesses can take advantage of 80% bonus depreciation.

 

In 2024, the bonus depreciation rate drops to 60%, falling by 20% per year thereafter until it is completely phased out in 2027. 

 

 

For more information on these rules please visit www.irs.gov “How to Depreciate Property”, or contact us.

Deduction for 2023 & 2024