Section 179 of the IRC allows businesses to take an immediate deduction for business expenses related to depreciable assets such as equipment, vehicles, and software.

October 28, 2022•1 min read

Section 179 of the IRC allows businesses to take an immediate deduction for business expenses related to depreciable assets. as equipment, vehicles, and software.

By J. Jason Astwood, LUTCF, FSCP

Section 179 of the Internal Revenue Code (IRC) allows businesses to take an immediate deduction for business expenses related to depreciable assets such as equipment, vehicles, and software. This allows businesses to lower their current-year tax liability rather than capitalizing an asset and depreciating it over time in future tax years.

The Section 179 limit for 2022 is $1,080,000. This is the total amount of eligible equipment that can be deducted, and the 'total equipment purchased' by a business cannot exceed $2,700,000.

The amount of depreciation taken on a piece of equipment is based on its useful life (the number of years it is expected to last before needing replacement). Depreciation can be claimed either as straight line or accelerated methods depending on how quickly the business expects its assets to wear out.

Jason Astwood

Hello! I'm Jason Astwood, LUTCF, FSCP. I'm the CEO of Astwood Consulting Group. I am a financial services professional with over 20 years of experience working with individuals, families, and small businesses. I attended Brigham Young University and the American College of Financial Services. I also had the privilege of serving a 2-year LDS mission in the San Francisco Bay Area. I'm married and have three great kids. I'm an author and speaker my books include, "5 Hacks To Financial Freedom" "It's Time To Put Your Finances In Order" and "The Retirement Crisis In America" I currently serve on the Board of Directors of the Utah Independent Agency Association. I'm the Past-President of the National Association of Insurance and Financial Advisors (NAIFA-Utah Central).

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