Do Service Trucks Count for Bonus Depreciation?
For the last several years, new service trucks absolutely qualified for Section 179 bonus depreciation for many companies.
In 2010 through 2013 the limit was as high as $500,000. You could deduct 50% of the cost of new equipment up to your net taxable business income for the year. Because this was meant to help smaller businesses, deductions for equipment purchases over $2,000,000 were phased out.
As of December 1, 2014, Washington has not passed anything regarding Section 179 bonus depreciation for this year. The current limit is $25,000 plus an adjustment for inflation.
However, the Senate Finance Committee has overwhelmingly passed the Expiring Provisions Improvement Reform and Efficiency (EXPIRE) Act of 2014. See Here. This bill extends the 50% bonus depreciation through the end of 2015.
Washington is also considering making a $500,000 Section 179 level permanent. This would be welcome news for small and medium sized companies.
So, we are currently at a “wait and see” stage. Congress could even pass this after Jan 1 and make it retroactive for 2014. These delays in decision making certainly do not help small businesses plan equipment purchases, fingers crossed that our elected officials get some visibility for us going forward.
Here are some helpful links on Section 179 Depreciation: