Bonus depreciation means savings for businesses
Customers looking to upgrade old equipment or purchase EEG amplifiers, systems, or equipment should do so before December 31st, 2021. Thanks to the Tax Cuts and Jobs Act, businesses can take advantage of 100% bonus depreciation when purchasing equipment. The purpose of this incentive is to get businesses to invest in themselves. Bonus depreciation can be more lucrative than a Section 179 deduction, which has limitations.
How does bonus depreciation work?
Here’s an example scenario of Bonus Depreciation:
XYZ Neuro Inc. returns a signed quote to Lifelines on December 17th, 2021 for new EEG equipment with a net purchase price of $60,000. Lifelines Neuro then assembles, ships, and invoices the order on or before December 31st. XYZ may be eligible to take 100% bonus depreciation on their 2021 tax return for $60,000 rather than depreciating equipment over 5 years. For simplicity, assuming 30% taxes (25% federal + 5% state), this would reduce XYZ’s 2021 tax liability by $18,000. In effect, XYZ will have only paid net cash of $42,000 for this equipment.**
Don’t miss the deadline
While bonus depreciation has been extended, it may not always be available as an option. Learn more about the limitations of Bonus Depreciation by visiting the IRS.gov fact sheet concerning the Tax Cuts and Jobs Act. Call us at 866-889-6505 or contact us today and make your purchase before December 31st, 2021.
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**NOTE: Lifelines Neuro Company, LLC and its affiliates do not provide tax, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any transaction.