As companies approach the end of the year, we tend to see a couple of trends amongst our current and potential clientele. These trends include either:
- The ever-present, and typically distracting, “fire drills” with a scramble to either spend the “use it or lose it” budgets or make final cuts prior to year-end to keep the bottom line strong depending on how the year went
- Or, the strategic planning for the next fiscal year.
In our blog post this month, we wanted to share some information on a topic that could potentially have an impact on both of these areas: the Section 179 deduction. This post is not intended to be financial or tax advice. We simply wanted to provide an informational post about what the Section 179 deduction is and highlight some of the benefits it could have for you. We encourage you to visit the Section 179 website to get the full details about the program, and suggest consulting your tax advisor for more information.
What is the Section 179 Deduction?
In technical terms:
(1)Section 179 of the IRS Tax Code allows a business to deduct, for the current tax year, the full purchase price of financed or leased equipment and off-the-shelf software that qualifies for the deduction. The equipment purchased, financed or leased must be within the specified dollar limits of Section 179, and the equipment must be placed into service in the same tax year that the deduction is being taken (for example, the equipment must be put into service between January 1st and December 31st of the year the deduction is to be taken.)
What does this mean for our current and potential clients?
The Section 179 deduction is something we encourage our clients and those considering Tour de Force to take into consideration when choosing a software system, as it has the potential for tax relief. The majority of clients we work with all have a need in some capacity for equipment, business vehicles, hardware, software (i.e. Tour de Force), and office products that all can qualify for the Section 179 deduction. The website referenced above has some great insight that includes full details of what qualifies, a helpful Q&A, and a 2017 Section 179 Calculator that can be useful to see what type of tax relief you could qualify for based on your business needs.
After 15 years of working with Manufacturers and Distributors, we know that your necessary purchases can be sizable investments for companies, so understanding Section 179 deductions can have the potential for immense savings for our current clients. We are also excited that off-the-shelf software, such as Tour de Force, qualifies in this tax break as well, so those of you currently evaluating a new CRM or BI product can also benefit from this program.
Regardless of if you are a client or just someone passing through, we hope that you find value in the post this month and hope that you can find some tax relief as we get close to the end of the year. If you would like to learn more about the Tour de Force Solution, please feel free to request a demo or contact us and we would be happy to learn more about your organization and provide you some insight on how our solution may benefit you.
(1) Information was pulled from the Section 179 website, located here: www.section179.org.