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Section 179 Expensing

Section 179 Expensing. Election to expense certain depreciable business assets. Sec. 179 Increased Amounts Extended. TIPRA of 2005 extended $100,000 maximum expenditure limit for 2 more years Returns to $25,000 for tax years beginning after 2009 Inflation adjustments 2005 was $105,000

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Section 179 Expensing

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  1. Section 179 Expensing Election to expense certain depreciable business assets

  2. Sec. 179 Increased Amounts Extended • TIPRA of 2005 extended $100,000 maximum expenditure limit for 2 more years • Returns to $25,000 for tax years beginning after 2009 • Inflation adjustments • 2005 was $105,000 • 2006 is $108,000 W L Hoover, Purdue University

  3. Sec. 179 Increased Amounts Extended • TIPRA also extended $400,000 investment limit for 2 years • Returns to $200,000 for tax years beginning after 2009 • Inflation adjustment • 2005 limit was $420,000 • 2006 limit is $430,000 W L Hoover, Purdue University

  4. Sec. 179 Income Limitation • Deduction limited to taxpayer’s taxable income from active conduct of trade or business • Taxable income from trade or business includes • Sec. 1231 net gains W L Hoover, Purdue University

  5. Sec. 179 Gulf Opportunity Zone Increases • Expenditure limit increased to $200,000 • Investment limit increased to $1 million • $1.03 million in 2006 • Placed in service on or after August 28, 2005 and before January 1, 2008 W L Hoover, Purdue University

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