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Create Your Own Tax Break for 2024

The Tax Cuts and Jobs Act of 2017 provides businesses with additional tax benefits for 2024 and beyond.

  • Under Section 179, businesses spending less than $3,050,000.00 a year on qualified equipment may write off up to $1,220,000.00 up front.
  • 60% Bonus Depreciation on qualified equipment acquired and placed in service from January 1, 2024 through December 31, 2024. The bonus depreciation now includes used equipment. It falls to 40% in 2025, 20% in 2026, and expires in 2027.
  • The $1,220,000.00 deduction from Section 179 phases out when a business purchases more than $3,050,000.00 in one year.
  • Companies cannot write off more than their taxable income.
  • The equipment must be placed in service by the end of the tax year.

What does this mean for businesses?

  • Our capital leases help businesses take advantage of the tax benefits (above) by extending payments out as long as 5 years.
  • Tax Savings could be greater than the amount paid in the first year of a capital lease.

Section 179 Deduction Calculator

Enter equipment cost:

1st year write-offs:

Section 179 Deduction:

 $

60% Bonus Depreciation:

$

Total Deduction in first year:

 $
Tax savings (for 21% rate): $
Equipment cost after tax savings: $

What is the Section 179 limit for 2024?

The maximum Section 179 deduction for the 2024 tax year is $1,220,000. That deduction phases out for companies that spend over $3,050,000 on equipment per year. These numbers are adjusted each year for inflation. Equipment acquisitions beyond this limit are still depreciable using bonus depreciation.

Does leasing packaging equipment qualify for Section 179?

Capital leases are considered to be ordinary equipment acquisitions for tax purposes, so they’re eligible for Section 179 and bonus depreciation.

Does packaging equipment qualify for bonus depreciation?

Yes, as long as it enters service in the year in which the depreciation is taken. This applies to both new and used equipment.

Does bonus depreciation have a limit?

Yes. Even with 60% bonus depreciation, you still can’t write off more than your taxable income.

American Packaging Capital, Inc. is not offering legal, tax, accounting, or financial advice. Customers are encouraged to consult with their tax and accounting advisors for a clear understanding of how these tax benefits and/or various equipment financing products could impact their specific business conditions. For complete details or changes to the tax incentives, please visit www.irs.gov or contact the IRS helpline at 800-829-4933