Retroactively effective for tax years beginning in 2012, the new tax act increases the maximum expensing amount under Code Section 179 from $139,000 to $500,000.
Effective for tax years beginning in 2013, the tax act increases the maximum expensing amount under Code Section 179 from $25,000 to $500,000. The tax act also increases the phase-out amount to $2 million.
For tax years beginning after 2013, the maximum expensing amount is scheduled to drop to $25,000.
The retroactive boost for tax years beginning in 2012 amounts to a windfall for eligible taxpayers that placed in service more than $139,000 of eligible property.
The tax act also extended the provision for 2 years, including 2012 and 2013, that up to $250,000 of qualified real property is eligible for expensing under Code Section 179. This includes qualified leasehold improvement property, qualified restaurant property, and qualified retail improvement property.
I saw a statement over the weekend that I loved and felt was very accurate. On CNNMoney it said, "The new law makes an already incomprehensible tax system even more incomprehensible."
We will continue to analyze the new tax act and will provide more details next week.
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