Stimulus Package–The Business Version
The IRS has announced, that in addition to the stimulus package for individuals, there is also a stimulus package for businesses. The business stimulus package has 2 parts. The first part is that there is a 50% depreciation allowance for business purchases made in 2008. According to the IRS website, “Under the new law, a taxpayer is entitled to depreciate 50 percent of the adjusted basis of certain qualified property during the year that the property is placed in service.” The property must be placed in service after Dec. 31, 2007, but before Jan. 1, 2009.”
The IRS revealed that the second part of this business plan relates to the Section 179 depreciation deduction and states, “Under the new law, a qualifying business can expense up to $250,000 of section 179 property purchased by the taxpayer in a tax year beginning in 2008. Absent this legislation, the 2008 expensing limit for section 179 property would have been $128,000. The $250,000 amount provided under the new law is reduced if the cost of all section 179 property placed in service by the taxpayer during the tax year exceeds $800,000.”
Your tax consultant should be able to advise you as to how your business can benefit from this stimulus package.