Leveraging Tax Code Section 179 for New Material Handling Equipment

14 Nov Leveraging Tax Code Section 179 for New Material Handling Equipment

Leveraging Tax Code Section 179 for New Material Handling Equipment

Investing in new material handling equipment can significantly boost your business’s efficiency, safety, and productivity. However, the costs associated with purchasing new equipment can be daunting. Fortunately, Tax Code Section 179 gives you an incentive to invest into equipment for your business today!

Let’s dive into how this works and how you can leverage it for your business.

Understanding Section 179 of the Tax Code

Section 179 of the U.S. Internal Revenue Code allows businesses to deduct the full purchase price of qualifying equipment and software purchased or financed during the tax year. Instead of depreciating equipment over several years, Section 179 lets businesses write off the entire cost upfront, offering immediate financial relief.

Key benefits of Section 179:

1. Immediate Write-off: Businesses can deduct the full cost of equipment purchased, rather than depreciating it over time.
2. Increased Cash Flow: With the ability to deduct 100% of the cost, businesses can preserve cash flow, which is critical for reinvestment.
3. Incentivizes Investment: Section 179 encourages businesses to invest in capital equipment and grow their operational capacity.

For 2024, the maximum deduction limit for Section 179 is $1.22 million, with a phase-out threshold of $2.89 million. This means that businesses can deduct up to $1.22 million in qualifying equipment purchases if their total equipment acquisitions do not exceed $3.05 million.

How to Qualify for Section 179

Most new and used material handling equipment, such as forklifts, cranes, pallet jacks, and conveyors, are eligible for the Section 179 deduction. The equipment must be:

• Purchased or financed (not leased) and in use by December 31 of the tax year.
• Used for business purposes more than 50% of the time.

Take Advantage of Equipment In Stock Today

Advanced Material Handling Systems has a large inventory of lift trucks that are ready for delivery! You can get the equipment you need before the end of the year and enjoy the benefits of Section 179 deductions!

You can view our inventory HERE!