It’s that time of year when we remind you to take advantage of the Section 179 2022 tax deduction! Prepare your business for 2023 by investing in additive solutions now and write off the entire purchase in 2022!
What is Section 179?
Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment and/or software purchased or financed – 3D printers and post-processing equipment included – during the tax year. That means that if you buy (or lease) a piece of qualifying equipment/software, you can deduct the FULL PURCHASE PRICE from your gross income. It’s an incentive created by the U.S. government to encourage businesses (particularly small and medium-sized) to buy equipment and invest in themselves.
Example of Section 179 at work during the 2022 tax year
2022 Deduction Limit = $1,080,000
This deduction is good on new and used equipment, as well as off-the-shelf software. To take the deduction for tax year 2022, the equipment must be financed or purchased and put into service between January 1, 2022 and the end of the day on December 31, 2022.
2022 Spending Cap on equipment purchases = $2,700,000
This is the maximum amount that can be spent on equipment before the Section 179 Deduction available to your company begins to be reduced on a dollar for dollar basis. This spending cap makes Section 179 a true “small business tax incentive” (because larger businesses that spend more than $3,780,000 on equipment won’t get the deduction.)
Who Qualifies for Section 179?
All businesses that purchase, finance, and/or lease new or used business equipment during tax year 2022 should qualify for the Section 179 Deduction (assuming they spend less than $3,780,000).
Bonus Depreciation
Bonus Depreciation right now in 2022 is being offered at 100%. Bonus Depreciation is generally taken after the Section 179 Spending Cap is reached. The Bonus Depreciation is available for both new and used equipment.
How much money can Section 179 save you in 2022?
The Section 179 Deduction has a real impact on your equipment costs. Here’s an easy to use calculator that will help you estimate your tax savings:
Visit Section179.org for full details on the Section 179 Deduction.
Check out our year-end 3D printer promos for even more savings!