Estimated tax tip savings. If you buy a large SUV or truck for your business, you can write off the entire business cost in a relatively short time regardless of what lawmakers do with the extenders package.
First, let’s have a word about the 2015 tax extenders package and its effect on your tax deductions for vehicles. For the past 10 years or so, lawmakers added 50 percent bonus depreciation and bigger Section 179 expensing deductions to certain vehicles.
The problem is that often lawmakers failed to add the bigger deductions on a timely basis and then added them with an extenders tax package retroactively, even after the year was over. The retroactive aspect makes tax planning hard (somewhat of a gamble).
For example, at the moment, there is no increase in 2015 Section 179 expensing. It’s stuck at a miserly $25,000 for all purchases combined. And in addition, there’s no 50 percent bonus depreciation available.
Here’s a situation: Let’s say you need a new vehicle for your business and you want a big write off. Do you gamble that lawmakers will again retroactively extend the benefits of bonus depreciation and bigger Section 179 deductions? And if your gamble does not work out, how much do you lose? This article helps you place a pretty good bet if the extenders fail to pass. ... Log in to view full article.