Section 179 Essay Example | Topics and Well Written Essays - 250 words

Section 179 - Essay ExampleThis is if the purchased equipment is depreciable over a certain period. It is an incentive sometimes used for some of the small enterprises to expand their tradinges (Daily 45). This is with the purchasing of new equipment in the business. Limitations of Section 179There is a higher tax bill that is acquired if the equipment purchased under surgical incision 179 is converted into personal use. If equipment is purchased under the method of instalment 179, it is highly likely that, during its depreciable life, it can be converted to personal use (Daily 48). However, it may prove expensive to do so to the party that intends to do this conversion.Section 179 also dictates that a taxpayers deduction in a year cannot exceed or pop off their income from that active financial year. This means that they are not capable of, or cannot use more than what they may earn in their active conduct of business (Daily 51). All this is within the duration of a year.Moreov er, under section 179, if one buys an asset, it is impossible for them to claim a deduction of more than what one paid for initially. This implies that purchasing an item use cash, the deduction on that item or asset is based only on the exact amount paid for the asset. In conclusion, section 179 is only suitable for the growth of businesses (Daily 58). It is not suitable, or advisable for purchasing equipment for personal use. Businesses can save a lot of money while using this method and can manage to grow and expand.