Section 179 ? Tax Relief From Depreciation Rules

"Depreciation." For business owners, this word is the one most likely to inspire headaches and fits of cussing. The expanded provisions of Section 179 are just the medicine you need to cure the depreciation blues.

Depreciation

Traditionally, if your business property had a life of more than one year, the cost had to be deducted over several tax years. The number of years depended on the characteristics of the property, which made depreciation the flag-bearing example of the complexities of the tax code. Shockingly, the federal government has provided substantial relief to business owners.

Section 179 of the Internal Revenue Code has been dramatically expanded to the benefit of businesses, particularly small ones. This code allows businesses to completely deduct the cost of tangible property in the year of purchase. The tax relief comes from the expansion of the total amount that can be deducted in one year.

Huge Deduction Increase

As part of the Job Growth and Reconciliation Act of 2003, the one-year deduction amount was increased from $25,000 to $100,000. The 100,000 figure will be adjusted for inflation each year, which means it will continue to increase. This is very good news.

What Property Qualifies?

You can deduct the cost of the following property under Section 179:

1. Machinery and equipment

2. Furniture and fixtures

3. Computer software.

You must elect Section 179. It is not automatically given to you. Simply fill out IRS Form 4562 and attach to the returns for the business.

In Closing

As shocking as this will sound, the government should be applauded for expanding Section 179. Small businesses are burdened by too many regulations and mandatory costs. The expansion of Section 179 is a nice piece of tax relief legislation. Let's hope more is on the way.

Richard Chapo is CEO of http://www.businesstaxrecovery.com - Obtaining tax refunds for small businesses by finding overlooked tax deductions and credits through a free tax return review.

In The News:

Govt panel gets time till Monday to submit direct tax code report  LivemintThe panel, led by CBDT member Akhilesh Ranjan, was earlier required to submit its recommendations on Friday.The new direct tax code will try to simplify tax ...
Will a new direct tax law push up compliance?  LivemintNumerous amendments over five decades, as well as the influence of case laws, often made it difficult to interpret the rules.Mint takes a look at what the new ...
FM Nirmala Sitharaman's next stop to assess tax situation to be Varanasi  Economic TimesSitharaman is keen on gaining ground-level feedback from both tax officers and taxpayers.
Income Tax Department issues checklist to trace unaccounted demonetisation cash  Economic TimesNEW DELHI: In a bid to seize illegal cash, the Income Tax Department has issued a 17-point checklist to tax commissioners across the country to track those ...
Governments around the world are considering taxing red meat like tobacco in an effort to curb climate change  Business InsiderA new report by Fitch Solutions reveals that a "sin tax" currently put on products like sugary drinks and tobacco could soon be applied to meat globally.
Google, Facebook, Twitter may be affected: Framework to tax big tech companies being finalised  Economic TimesRevenue threshold of Rs 20 cr & a limit of 500000 users may be set for a non-resident technology firm to pay tax.
Govt forms committee to rationalise additional taxes on Aviation Turbine Fuel  LivemintThe Aviation Ministry has formed a committee to rationalise additional taxes that airlines have to pay while uplifting Air Turbine Fuel (ATF) at airports across India ...
How To Reduce Taxes In Retirement  ForbesEven though you may be retired, the tax man is ready to take a slice of your Social Security and retirement fund payouts. How can you minimize his cut? Stephen ...
Sajid Javid will 'simplify' the tax system in first Budget  BBC NewsChancellor Sajid Javid has said he wants to simplify the tax system ahead of his Budget in the autumn. In his first interview since becoming chancellor, Mr Javid ...
How a small tax-paying elite funds the Indian state  LivemintThe move to raise surcharges on the incomes of India's super-rich taxpayers has led to a barrage of criticism from tax experts who have questioned such ...
Finance Ministry to cut tax on prize post PM nudge  Economic TimesNEW DELHI: The Finance Ministry has withdrawn the tax exemption it had granted to the cash prize of Rs 1.3 crore received through the Seoul Peace Prize by ...
Hiking income tax appeal limit to reduce litigation, help govt focus on high-value cases: Experts  MoneycontrolThe finance ministry's decision to significantly increase the limit for the income tax department to appeal disputes in higher forums will reduce litigation and ...
Send harassment-related cases directly for necessary relief: FM to tax payers  BusinessLineTo consider uniform 25 per cent corporate tax rate for all categories after buoyancy in tax collections.
How to get the most from this tax-free source of retirement income  CNBCCash value life insurance can complement your retirement plan by acting as a source of tax-free income. Just make sure you don't mismanage your policy.
These cities have the highest sales taxes in the US  Fox BusinessThis Midwest hub isn't the only city putting the tax squeeze on residents.
CBDT extends angel tax relief to startups facing tax demands  LivemintThe move seeks to ensure that genuine entrepreneurs are not affected by the provision that allows the government to demand tax on share premium, treating it ...
Tax terrorism: Embedded in laws & practice  Business StandardRead more about Tax terrorism: Embedded in laws & practice on Business Standard. Blaming tax officials will not help us get to the root of the issue.
When Public Schools Rely on Local Property Taxes: Letters  The AtlanticReaders discuss the phenomenon of school districts being isolated from financial resources in their communities.
ITR Filing 2019: 5 incomes you must not miss to report in your Income Tax Return for AY 2019-20  The Financial ExpressIt is advisable to be extra careful while filing income tax return this year as even a small mistake can result in the issue of a notice from the Income Tax ...
Reaching the zero income tax level of ₹5 lakh  LivemintMUMBAI: Did you know you could pay zero taxes even if you earn more than ₹5 lakh? According to the current tax laws, there are three tax slabs depending on ...
We Could Eliminate Extreme Global Poverty If Multinationals Paid Their Taxes  TruthoutThe cost of global corporate tax avoidance is $500 billion and poor countries are bearing 40 percent of it.
As Mamata Slams Durga Puja Tax, Top I-T Officer Says Clamour Based on 'Misleading Facts'  News18Kolkata: Income Tax officials have rubbished West Bengal Chief Minister Mamata Banerjee's claim that the I-T department had issued notices to Durga Puja ...
Gujarat: Businessmen upset as tax amnesty not announced  DNA IndiaBusinessmen and tax practitioners in the state are irked as no action has been taken regarding the announcement by Finance Minister Nitin Patel while ...
FM Sitharaman silent on higher taxes for FPIs :sources  Business TodayFinance Minister Nirmala Sitharaman gave no indication at a meeting with foreign portfolio investors on Friday that she would withdraw a proposal to raise their ...
Income tax return filing for AY 2019-20: These details are pre-filled in your ITR form  LivemintNEW DELHI: Making it easier to file your income tax returns from this assessment year 2019-20 or financial year 2018-19, the Income Tax department is ...
Nirmala Sitharaman silent on withdrawing higher taxes for foreign investors  LivemintNew Delhi: Finance Minister Nirmala Sitharaman gave no indication at a meeting with foreign portfolio investors on Friday that she would withdraw a proposal to ...
All tax letters, notices to carry identification numbers to be verifiable online from Oct 1, 2019  Economic TimesStarting October 1, 2019, all letters and notices from the income tax department will carry a computer-generated Document Identification Number (DIN) which will ...
What is Direct Tax Code? Report likely today  LivemintThe new direct tax code will try to make personal income tax rates more 'progressive'.Prime Minister Narendra Modi had last year told tax officials that the old ...
Angel tax row: Income Tax department gives a breather to start-ups  Business StandardRead more about Angel tax row: Income Tax department gives a breather to start-ups on Business Standard. After protests by start-ups, the government had ...
Letters to the Editor: The trickle-down effects of taxing commercial properties  Los Angeles TimesTo the editor: The myth promoted by supporters of a split roll to exempt commercial property from Proposition 13 is that the consumer won't pay for this. It will be ...
Freedom from tax burden for angel funds  Economic TimesExemption from angel tax even if assessment order was passed before February 19.
Red Meat Could Be the Next Sin Tax After Sugar, Fitch Says  BloombergMeat could be a target for higher taxes given criticism of the industry's role in climate change, deforestation and animal cruelty, according to a report by Fitch ...
California Is Headed Toward a Titanic Battle Over Raising Property Taxes  New York MagazineUnless a legislative compromise is worked out, California will host a classic left-versus-right ballot initiative fight in 2020 over a bid to remove commercial ...
Africa's financial inclusion at risk from mobile money taxes  Quartz AfricaMuch has been written about the need for African countries to collect more tax revenue from citizens and businesses. The IMF has been imploring sub-Saharan ...
Tighten scrutiny of tax exemption claims on farm income: CAG to I-T Departement  LivemintClaims of tax exemption on farm income have attracted the attention of the Comptroller and Auditor General of India (CAG), which has called for greater efforts to ...
How to File Income Tax Returns aka ITR Online in India  Gadgets 360ITR aka income tax returns can be easily filed online for free in India. Here's how you can do that.
Todd and Julie Chrisley Plead Not Guilty to Tax Evasion and Bank Fraud  The New York TimesTodd and Julie Chrisley, a wealthy Southern couple who project a public image as a God-loving, straight-talking husband and wife on the reality TV show ...
State and Local Taxes Are Worsening Inequality  The New York TimesEconomic inequality is on the rise in Illinois, and the state government is part of the problem. Illinois taxes low-income families at much higher rates than ...
Maruti Suzuki seeks tax relief for hybrid, CNG cars  LivemintMaruti Suzuki said there is a need to promote hybrid, CNG cars as it will take some time for mass acceptance of EVs considering the high cost of technology.
Bill de Blasio’s “tax the hell” out of rich people plan, explained  Vox.comThe New York City mayor is basically taking a bunch of progressive tax proposals and making them bigger.
These Portfolio Tracking Tools Will Also Prepare Your Crypto Taxes  Bitcoin NewsTax season is months away, which is why you need to start preparing for it now. Leave everything to the last minute and you'll only end up cursing your.
New CSR levy: A quasi tax  Business StandardRead more about New CSR levy: A quasi tax on Business Standard. The approach to push companies, which do not see a business case for CSR, to invest in ...
Tax and office tax  The Arunachal Times[ M Panging Pao ]. The common citizens pay taxes to the government for buying every commodity and good from the market. The citizens pay tax for buying ...
Income tax notice to Durga puja committee; Trinamool Congress to protest  LivemintKolkata: The Banga Janani wing of West Bengal's ruling Trinamool Congress will hold a demonstration on Tuesday to protest against Income Tax Department's ...
FMCG companies seek tax relief on dealer discounts to lift sales  Economic TimesFMCG industry has petitioned to remove GST on amount received by dealers as reimbursement against discounts.
GST on electric vehicles, chargers slashed  BusinessLineThe Goods & *Service* Tax (GST) Council on Saturday decided to lower the duty on all electric vehicles (EVs) and the charger for such vehicles. This is the ...
IRS Warnings to Bitcoin Traders Offer Clues to Coming Tax Guidance  CoinDeskThe Takeaway: The IRS' recent warning letters to 10,000 traders offer hints at what its forthcoming guidance on crypto taxes might say. While the letters are not ...
How to claim tax exemption on long term capital gains? Answers to your personal finance queries  The HinduQ. I sold a flat for ₹40 lakh in February 2019. I had bought the property in my name in September 2001 for ₹12 lakh. Now, I want to use this entire money to ...
Home improvements and your taxes  AOLAs a homeowner you may be asking, "Do I get a tax break for all the money I've spent fixing up my house?" The answer depends on the kinds of improvements ...
BMC to impose property tax on individual flat owners directly to improve accountability: Report  MoneycontrolIn a move aimed at improving accountability, the Brihanmumbai Municipal Corporation (BMC) will tax individual flat owners directly, rather than buildings.
How to show your trading and F&O income in the tax returns?  BusinessLineBL Research BureauFor traders, aside from predicting the stock market, reporting income from intra-day trading or Futures & Options (F&O) in the tax ...
Textile companies seek tax incentives, DBT for farmers  Economic TimesNEW DELHI: Indian textile and clothing industry players say one-third of their production capacity is lying idle due to sluggish exports, poor domestic demand, ...
Don’t Ban Assault Weapons—Tax Them  The AtlanticThe nation is debating what to do about assault-style weapons, what gun-rights advocates like to call modern sporting rifles. Gun-rights champions argue that ...
Julián Castro would boost taxes on wealthy to expand family programs  POLITICODemocratic presidential candidate Julián Castro today rolled out a plan to boost taxes on the wealthy and expand or create a host of federal programs for low- ...
Have you filed your income tax return correctly? Find out  Economic TimesHere's a short quiz to help you understand if you are on the right track to file your income tax return.
Best of BS Opinion: Tax terrorism, govts financial constraints, and more  Business StandardIndustry's demands and the government's response leave a lot of gaps. They seem to diverge at most points even though both acknowledge they complement ...
IT companies fume over double taxation avoidance treaty with Australia  Business StandardInformation technology majors have blamed the current Double Taxation Avoidance Treaty (DTAA) with Australia as a major constraint on plans to grow ...
We can’t fund the progressive agenda by taxing the 1% alone  Vox.comThe tricky politics of taxing the 1%, the middle class, and everyone in between.
Trump's tax cut isn't giving the US economy the boost it needs  CNBCBenefits from what President Trump called "the biggest reform of all time" to the tax code have dwindled to a faint breeze just 20 months after its enactment, ...
Germany weighs taxing meat to help animals and the climate  Vox.comHere's one way to discourage people from indulging in a damaging habit: tax the hell out of it. Cigarettes and alcohol are already taxed. In some cities, soda is ...
You might need to maintain tax returns records for seven years  LivemintIn today's digital age, income tax records can be maintained at little or no expense for long periods of time in a digital format. However, it is important to know the ...
Report: US government losing billions in corporate tax revenue from IRS budget cuts  USA TODAYA study says the government could have collected $34.3 billion more in taxes from corporations by increasing IRS resources by less than half that amount.
Trump sues over California law forcing candidates to turn over tax returns  CNNPresident Donald Trump sued California Tuesday challenging a state law that requires candidates for president to disclose income tax returns before they can ...
Deadline for Real Property Taxes approaches for Kauai, Oahu residents  Hawaii News NowHONOLULU, Hawaii (HawaiiNewsNow) -The Real Property Tax deadline is this week for Oahu and Kauai residents. This covers the 2019-2020 tax year.
Is it too late for Colorado to capture billions of dollars in oil and gas tax revenues in a permanent fund?  The Denver PostCentennial State still has no permanent mineral trust fund; that's OK, say those who see system working as envisioned.
Uber Created a $6.1 Billion Dutch Weapon to Avoid Paying Taxes  BloombergUber Technologies Inc., responding to a European crackdown on offshore tax havens, created a $6.1 billion Dutch tax deduction that will help the company ...
Income Tax Filing 2019: Check your income tax refund status  The Hans IndiaOnce the income tax department process you Income Tax Return (ITR), your bank account will get tax refund directly.
Three different routes to save tax on long-term capital gains  LivemintThere are provisions under different sections of the Income-tax Act that can help you save on LTCG tax.Capital gains exemption will be reversed if you sell the ...
ITR filing for AY 2019-20 explained in 3 steps  LivemintIt is the time of the year when everybody is busy filing their income tax returns (ITR). The government has extended the deadline for filing ITR to August 31.
FM to Launch Taxpayer E-assistance Campaign at 'Income Tax Day' Event on Wednesday  News18New Delhi: A country-wide 'taxpayer e-assistance campaign' will be launched on Wednesday by Finance Minister Nirmala Sitharaman to mark the 159th ...
Amazon.com defeats IRS appeal in U.S. tax dispute  ReutersAmazon.com Inc on Friday defeated an appeal by the U.S. Internal Revenue *Service* in what the online retailer has called a $1.5 billion dispute over its tax ...
Do I have to pay tax for the capital gains earned by my homemaker wife?  Economic TimesMy wife is a homemaker and she has invested Rs 40,000 of her savings in stocks. If she sells these stocks and earns short-term capital gains, will I have to pay ...
10 salary components that can help employees reduce tax burden  Economic TimesYour salary structure consists of several components which can help you reduce your tax burden. While some of these components are fully or partially taxable, ...
10 reasons why you may get a notice from the income tax department  Economic TimesYou may anytime come under the taxman's lens. Here are 10 reasons taxpayers can get an income tax notice.
Analysis: GOP candidates talk tax cuts, but no spending cuts  Tacoma News TribuneLouisiana's seven-year tax deal, aimed at bringing a cease-fire to the state's tax feuds after seven special legislative sessions across three years, hasn't ended ...
Modi has a message for 'growth ambassadors', 'tax black sheep': 10 key highlights from PM's interview  Economic TimesPrime Minister Narendra Modi, in a free-wheeling interview to ET, said government is willing to go as far as possible to fire up the animal spirits in the economy.
Income tax notices without a unique ID will soon be treated invalid. 5 points  LivemintThe new rules for issuance of income tax notices with unique IDs will come into effect from October.At present, some notices are issued manually without any id ...
Steep rise in limits for I-T filing tax appeals  Times of IndiaIndia Business News: The threshold limits for filing of appeals by the income tax department with tax tribunals, high courts and the Supreme Court were raised by ...
Income Tax dept relaxes assessment and scrutiny norms for start-ups  Business StandardRead more about Income Tax dept relaxes assessment and scrutiny norms for start-ups on Business Standard. In cases where start-ups are recognised by the ...
Colorado severance tax collections expected to drop sharply, even though a bust is nowhere in sight  The Denver PostColorado, like other states, taxes the natural resources that are "severed" or removed from the earth. But after two up years, those revenues are expected to drop ...
Do I have to pay capital gains tax if I switch between schemes of same mutual fund?  Economic Times"The switching of schemes would be considered as redemption or sale of units of one scheme and purchase of units of the other scheme."
India’s tax administration needs a mindset change: Nirmala Sitharaman  Times of IndiaIndia Business News: Amid allegations of “tax terrorism”, finance minister Nirmala Sitharaman has sought a mindset change in tax officials while advocating a ...
More than super-rich tax, the dull equity market is putting FPIs off  BusinessLineAfter all, they continue to invest in debt even when paying the levy on the interest income.
Interest from bank FDs, savings accounts: Income tax rules, how to fill in ITRs  LivemintMost of us earn some interest from deposits in banks or post offices. From Assessment Year 2019-20, tax-payers are required to submit a break-up of interest ...
5 Common Components Of Salary That Are Exempt From Income Tax  GoodreturnsWhen you receive your salary payslip, you may have observed that your salary has a break-up of different components. These components include allowances ...
Trump files lawsuit against California election law that requires his tax returns  Vox.comTrump must provide five years' worth of income tax filings by November if he wants to secure a spot in the state's March 3 primary.
Greece’s new finance minister vows to prioritise tax reforms  Financial TimesGreece's new finance minister has said that implementing sweeping tax reforms will be his “key priority” as his country seeks to boost growth and rebuild ...
MCI asked to withdraw 200% hike in property tax  The News InternationalIslamabad : The Islamabad Chamber of Commerce & Industry has called upon the Metropolitan Corporation Islamabad to withdraw the over 200 per cent hike in ...
Google, Facebook, Amazon to testify in US against French digital tax  CNBCGoogle, Facebook and Amazon are among the companies that will testify Monday at a U.S. government hearing on the French government's digital services tax.
Connecticut holds 19th tax-free week for back-to-school shoppers  WABC-TVConnecticut's annual back-to-school, tax-free week is expected to save consumers almost $5 million.
Alternate dispute resolution mechanism expected in new tax code  Business TodayThe new Direct Tax Code to be submitted on August 16 by the committee headed by Principal Chief Commissioner of Income Tax Akhilesh Ranjan will have, ...
Letters to the Editor: Defending California's demand for President Trump's tax returns  Los Angeles TimesTo the editor: Politics surely played the role in demanding tax returns for President Trump for California's March 3, 2020, primary election ballot. However ...
Tax amnesty proposed, prompting renewed debate  Myanmar TimesThe chorus of voices defending and opposing the reduction of tax rates for undisclosed income has come to the fore again following the submission of the Union ...
No income tax on interest from accident compensation: High Court  LivemintMumbai: Forty years after an eight-year-old city boy was left maimed for life in a car accident, the Bombay High Court on Thursday held that income tax should ...
Mauritius Leaks exposes tiny tax haven's role in vast offshore system  International Consortium of Investigative JournalistsBased on 200000 files, this new ICIJ investigation uncovers a sophisticated system that diverts tax revenue from poor nations back to the wealthy elite.
New income tax refund rules: Linking bank account with PAN card is mandatory  LivemintTaxpayers whose bank accounts are not linked with PAN cards are likely to face trouble in getting income tax refunds.Linking your bank account with PAN is ...
City Council to vote on tax increase  KFOX El PasoMy position on taxes in this town is that they're insane. Property taxes especially,” David Carroll said. Last Tuesday, Mayor Dee Margo vetoed the city's proposed ...
New tax poised to diminish bond activity  Bangkok PostActive bond trading and new debenture issuance are expected before the 15% withholding tax imposed on fixed-income funds takes effect on Tuesday, in order ...
How to Handle Doubtful Issues On Income Tax Return Filing: CBDT Issues Clarifications  Moneylifelthough the income tax (I-T) department had notified tax return forms for assessment year 2019-20 (FY2018-19), and released software utilities for filling (ITRs) ...
‘An elitist project for the upper middle-class!’ - Campaigner takes aim at sugar ‘sin tax'  ExpressSO CALLED 'sin taxes' on sugar, alcohol and tobacco are “an elitist project” led by the “upper middle-classes” according to a prominent individual liberty ...

What Is Tax Law?

The federal tax code is complex. This complexity generally arises... Read More

Small Business Tax Issues for Self-Employed Individuals

The United States is a nation of entrepreneurs. There are... Read More

Employment Taxes ? Depositing With The IRS

If your business has employees, you must pay employment taxes.... Read More

Are You Overpaying Taxes If You Use Tax Preparation Software?

For many business owners the answer to this quandary is... Read More

Know A Tax Cheat? Get Paid To Tell The IRS

According to the IRS, taxpayers underpay their taxes by some... Read More

Electronic Commerce Taxation and Pakistan

Assume a buyer in Pakistan downloads software from the Internet... Read More

Corporations Failing To Claim AMT Exemption Overpay Taxes By $11,000

Does your incorporated business pay alternative minimum tax ["AMT]? If... Read More

Understanding Marketing Tax Deductions

Marketing is a necessary expense in running practically any business... Read More

How to Reduce the Estate Tax Using the A-B Revocable Living Trust

In a past article I relayed the plight of the... Read More

IRS Lock-In Letters ? What?s An Employer To Do?

Employers often ask employees to designate the amount of tax... Read More

How to Check the Status of Your Tax Refund Online

So, you were pleasantly surprised to learn that you are... Read More

Correspondence From The IRS ? Yikes!

It's a moment every person dreads. You pick up the... Read More

Tax Reduction Tips

In the rush to get tax returns prepared and filed... Read More

Getting A Second Extension to File 2004 Taxes

Millions of people file tax return extensions every year. The... Read More

Tax Tips for Home-Based Business Owners

As tax time approaches, many home-based business owners begin completing... Read More

How Likely Are You To Be Audited?

Statistics for IndividualsUnfortunately, the IRS increased its rate of auditing... Read More

Small Business Tax Credit - Americans with Disabilities Act

Many small businesses complain when confronted with the expense of... Read More

Save Money on Taxes - Is the Only Way to Get Your Tax Savings is to Sleep With an IRS Agent?

Tilting the Tax Laws in Your Favor.In order to accelerate... Read More

Highlights of IRS List of 2005 Tax Scams

Each year, the IRS lists various scams taxpayers get caught... Read More

How To Set Up A Tax-Saving Bookkeeping System

One of the most important, but least understood or appreciated... Read More

How To Claim CHILD TAX CREDIT The Right Way And Add An Extra $2,000 To Your Refund

The U.S. Department of Agriculture estimates that it costs nearly... Read More

Euro Tax Haven Threat

Media reporting of a new EU savings tax directive has... Read More

How To Get An Extension To File Your Business Tax Returns

Yes, the tax season is upon with the first filing... Read More

Small Business Tax Deductions for Year End 2004

As a small business owner, it's wise to familiarize yourself... Read More

Failure To Pay Employment Taxes ? Penalties

As an employer, you must pay employment taxes if you... Read More