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By Staff Reporters
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DEFINITION: Section 179 of the U.S. IRS code is an immediate expense deduction that business owners can take for purchases of depreciating business equipment instead of capitalizing and depreciating the asset over a period of time. The Section 179 deduction can be taken if the piece of equipment is purchased or financed and the full amount of the purchase price is eligible for the deduction.
CITE: https://www.r2library.com/Resource/Title/082610254
Not understanding parameters – Eligible property and annual limits
Medical practices may make mistakes by not fully understanding which types of property qualify for a Section 179 deduction. Section 179 is applicable only to assets used for business purposes. Failing to allocate assets properly can lead to improper deductions.
Eligible property for Section 179 may include:
- Equipment, X-Ray, computers, fax machines, telephones, and other business property
- Furniture and fixtures
- Off-the-shelf-software that is used for business operations
- Improvements to real-estate such as roofs, heating, ventilation, and air-conditioning.
Section 179 limits are updated annually, so it is important for doctors and practice owners to be aware of these limits and to plan accordingly.
Source: Natalie Westfall, Physicians Practice [12/4/23]
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Filed under: "Ask-an-Advisor", "Doctors Only", Accounting, Ethics, Taxation | Tagged: Accounting, deductions, IRS, IRS tax, Section 179, tax, tax deductions physicians, tax mistakes, tax mistakes physicians | Leave a comment »
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