With year-end rapidly approaching, now is the time to take steps to cut your 2019 business tax bill. This column has some ideas for this year, but you also have to think what might happen to your business tax situation in 2020 and beyond. So, it’s a bit complicated this time around. But we forge ahead. Here goes.
Claim 100% first-year bonus depreciation for qualified asset additions Thanks to the Tax Cuts and Job Act , 100% first-year bonus depreciation is available for qualified new and used property that is acquired and placed in service in your business in calendar year 2019. That means your business might be able to write off the entire cost of some or all of its 2019 asset additions on this year’s return. So, consider making additional acquisitions between now and year-end.
Key Point: For 2019, the aforementioned luxury auto depreciation limits can only apply to vehicles that cost more than $50,500. Vehicles that cost less are depreciated under the “regular rules” using the following annual depreciation rates. Consult your tax pro for full details. The TCJA expanded the definition of real property eligible for the Section 179 deduction to include qualified expenditures for roofs, HVAC equipment, fire protection and alarm systems, and security systems for nonresidential real property. To qualify, these items must be placed in service after the nonresidential building has been placed in service.