Many taxpayers overlook the long list of deductions that they may take when completing and filing their tax returns. The IRS has estimated that millions of taxpayers overpay their taxes each year mainly because they fail to avail themselves of all of the possible deductions. Here is the seventh part of our multi-part series of blogs on the most overlooked tax deductions:
BUSINESS EXPENSES AS DEDUCTIONS
Bonus Depreciation
When it comes to acquiring new equipment for an enterprise, business owners must regularly stay updated on all current, pertinent tax rules and regulations, which constantly change. The tax professionals at the Thorgood Law Firm can help ensure that all taxpayers take advantage of any and all deductions that may apply to them.
For example, in 2011, a business could use 100% bonus depreciation to deduct the full cost of equipment in the year that the business owner/taxpayer put the equipment into service. Of course, this was in contrast to writing off the cost of new equipment over a period of years. But over time, Congress reduced the bonus depreciation percentage rate from 100% to as little as 30% over the next eight years. During the last five years, Congress has allowed it to expire and then reinstated it.
Supercharged Expensing
Supercharged “expensing” allows taxpayers to write off the full cost of qualifying assets in the year they were placed into service. Like bonus depreciation, this tax break seems to observe the same cycle of death and rejuvenation. For future years beyond 2015, businesses can expense up to $500,000 worth of assets, while the half-million-dollar cap phases out dollar for dollar for firms that put more than $2 million worth of assets into service in a single year.
If you live in the New York or the Tri-State area and have any questions about any possible tax deduction, call THE TAX EXPERTS at the Thorgood Law Firm www.thorgoodlaw.com. For a FREE consultation, call 212-490-0704.
