As a way of stimulating the economy and encouraging businesses to invest in capital equipment, the government has offered Section 179 to businesses as an incentive. Over the last few years, the amount you could deduct varied but this incentive has been around for almost a decade now.
Does purchasing a forklift qualify for Section 179?
Section 179 allows a business to deduct the FULL purchase price (yes, the full purchase price up to $1,050,000 in 2021) verses the traditional amortization schedule deducted over the course of a five to seven year period. Most new, used and some software qualifies for this special incentive.
In the case of new and used forklifts, this does qualify as capital equipment. So if your business could benefit from a business deduction, this may be just the tax incentive you need to make that long needed purchase. Since this deduction involves your company finances, consulting with your CPA or financial advisor prior to your purchase is recommended.
Does my forklift purchase qualify for 100% Bonus Deprecation?
Yes! Both new and used equipment purchases qualify for the 2021 tax year 100% Bonus Depreciation. This deduction is in addition to the Section 179 deduction.
Can Barclay help me with purchasing a new or used forklift?
Yes, there are many benefits from buying your forklifts and material handling equipment through Barclay. Our professionals help you take the guesswork out of buying the correct equipment for your application need. Whether buying new or used, Barclay will work with you to match the right specifications to the application use considering all factors including the age and condition of the equipment when buying used. The professionals at Barclay will make sure you will get the best equipment suited for your application and budget.
But the professionals at Barclay are not financial advisors so it is important to consult with your businesses’ financial councilors to see how Section 179 could benefit your company.
Are there any other requirements?
The Section 179 tax depreciation can be taken on new equipment, used equipment and off-the-shelf software. The equipment must be purchased or financed and placed into service during the 2021 fiscal tax year. The “placed into service” is important to note with new material handling equipment because sometimes there is factory order delivery lag time. Used forklifts and other equipment can be pulled from in stock and delivered well before the December 31, 2021.
For more information on forklifts and material handling equipment, contact Barclay today. For more information on Section 179, visit the IRS website or contact your tax adviser.