< Back to Thought Leadership

Sec. 179 Expensing Provides Many Businesses Tax Savings On 2017 Returns

If you purchased qualifying property by December 31, 2017, you may be able to take advantage of Section 179 expensing on your 2017 tax return. You’ll also want to keep this tax break in mind in your property purchase planning, because the Tax Cuts and Jobs Act (TCJA), signed into law this past December, significantly enhances it beginning in 2018.

2017 Sec. 179 Benefits

Sec. 179 expensing allows eligible taxpayers to deduct the entire cost of qualifying new or used depreciable property in Year 1, of course, subject to various limitations. For tax years that began in 2017, the maximum Sec. 179 deduction is $510,000. The maximum deduction is phased out dollar for dollar to the extent the cost of eligible property placed in service during the tax year exceeds the phase-out threshold of $2.03 million.

Qualified real property improvement costs are also eligible for Sec. 179 expensing. This real estate break applies to certain:

  • improvements to interiors of leased nonresidential buildings
  • restaurant buildings or improvements to such buildings
  • improvements to the interiors of retail buildings

Permanent Enhancements

The TCJA permanently enhances Sec. 179 expensing. Under the new law, for qualifying property placed in service in tax years beginning in 2018, the maximum Sec. 179 deduction is increased to $1 million, and the phase-out threshold is increased to $2.5 million with both amounts indexed for inflation in the future. The new law also expands the definition of eligible property to include certain depreciable tangible personal property used predominantly to furnish lodging. The definition of qualified real property eligible for Sec. 179 expensing is also expanded to include the following improvements to nonresidential real property: roofs, HVAC equipment, fire protection and alarm systems, and security systems.

Many rules apply, so please contact your local Blue & Co., LLC tax advisor to learn if you qualify for this break on your 2017 return. We’d also be happy to discuss your future purchasing plans so you can reap the maximum benefits from enhanced Sec. 179 expensing and other tax law changes under the TCJA.

COVID-19 initiatives impacting RHCs

New COVID-19 Initiatives Impacting RHCs

On Tuesday May 4, 2021, President Biden announced three new COVID-19 initiatives impacting RHCs. Nearly $1 billion of funding is being made available as part of the American Rescue Plan (ARP) to support rural COVID-19 response efforts and increase COVID-19 vaccine availability in rural communities. The President’s announcement included the following initiatives: Shipping New Allocations […]

Learn More

Employer Tax Credits for Providing Paid Sick and Family Leave Related to COVID-19

The American Rescue Plan Act, enacted March 11, 2021, aims to deliver economic relief to families and workers. On April 21, President Biden announced a provision of the American Rescue Plan Act that allows eligible employers to claim refundable tax credits for providing emergency paid sick leave to employees who take time off for reasons […]

Learn More
Charity Reimbursement

Charity Reimbursement: Protecting it from Audit Scrutiny

There is a new audit trend coming down the pipeline that could impact your charity reimbursement for Medicare bad debt. In the past there was no enforcement of statements being sent to a charity patient before they were deemed indigent. Until a patient has been approved for charity, they are still deemed non-indigent. Auditors are […]

Learn More