What is Section 179?
A tax code provision allowing businesses to deduct the full purchase price of qualifying equipment.
True or false: Section 179 applies only to new equipment.
FALSE
Section 179 applies to both new and used equipment, as long as it is new to the business.
Fill in the blank: Section 179 limits the deduction to _______ per year.
$1,220,000 for 2024.
What is the phase-out threshold for Section 179?
The deduction begins to phase out after $3,050,000 in equipment purchases.
Define qualifying property under Section 179.
Tangible personal property used in a trade or business, including machinery and equipment.
True or false: Section 179 can be used for real property.
TRUE
Certain improvements to nonresidential real property qualify for Section 179.
What is the maximum deduction for SUVs under Section 179?
$28,900 for vehicles over 6,000 pounds.
Fill in the blank: Bonus depreciation is available for _______ after Section 179 limits.
Any remaining amount.
What is the business income limit for Section 179?
The deduction cannot exceed the business’s taxable income.
Define listed property in the context of Section 179.
Property that has limited business use, such as vehicles and computers.
True or false: Section 179 can be claimed on leased equipment.
FALSE
Section 179 applies to purchased equipment, not leased assets.
What is the recapture rule for Section 179?
If the property is sold or no longer used for business, the deduction may need to be recaptured.
Fill in the blank: Section 179 is designed to encourage _______ by businesses.
Investment in equipment.
What is the impact of Section 179 on cash flow?
It allows businesses to reduce taxable income, improving cash flow.
True or false: Section 179 can be used for improvements to existing equipment.
FALSE
Section 179 applies to new purchases, not improvements.
What is the filing requirement for claiming Section 179?
Businesses must file Form 4562 with their tax return.
Fill in the blank: Section 179 is part of the _______ tax code.
Internal Revenue Code (IRC).
What is the primary benefit of Section 179?
Immediate tax relief for businesses investing in equipment.
Define expensing in relation to Section 179.
The process of deducting the full cost of qualifying property in the year it is purchased.
True or false: Section 179 is available to all businesses.
TRUE
Any business with taxable income can utilize Section 179.
What is the 2024 deduction limit for Section 179?
$1,220,000.
Fill in the blank: Section 179 encourages businesses to buy _______.
Equipment and machinery.
What happens if a business exceeds the Section 179 limit?
The excess amount can be depreciated over time.
Define depreciation in the context of Section 179.
The allocation of the cost of an asset over its useful life.
