Section 179 of the Internal Revenue Code (IRC) allows businesses to deduct the cost of qualifying manufacturing equipment and software in the year it is purchased or placed in service. This is a significant tax savings for small businesses, especially those that purchase a lot of equipment. With this deduction, businesses can save money on their taxes and invest in new equipment and software.
How does this tax deduction apply to you?
Whether buying new or used equipment, the Section 179 tax deduction applies. Most of the manufacturing equipment we offer, such as CNC routers, spindle motors, and CNC system controllers, are qualifying items. Some CNC software also qualifies for the deduction.
Examples of CNC Equipment You Can Write Off:
A CNC Router
A New Spindle Motor
A New CNC System
To qualify for the Section 179 deduction, the equipment or software must be used in the business and must be placed in service during the 2023 tax year. The equipment or software must also be depreciable, which means that it must have a useful life of more than one year.
Section 179 Tax Deduction Limits & Spending Caps
Businesses can deduct up to $1,160,000 of qualifying manufacturing equipment and CNC software purchased in 2023. However, there is a spending cap of $4,050,000. If equipment purchases exceed the spending cap, every dollar spent over the spending cap is removed from the $1,160,000.00 deduction.
Where can I get more information about Section 179?
If you are a small business owner and are thinking about investing in equipment for your company, call your tax preparer to see how much you can save with Section 179. Beneficial information as well as tools in regard to this deduction can be found at: http://www.section179.org/
Questions about purchasing CNC router machinery for your manufacturing company? Contact our CNC router sales team today.