In the days before the members of the Ohio congressional delegation went on their annual holiday break (along with all other members of Congress), the House and Senate passed a bipartisan omnibus bill. The package that funds the federal government received both praise and scorn, but one provision that received little media attention makes life simpler for owners of small and mid-sized businesses.
The simplification applies to the Section 179 deduction -- a portion of business tax filings related to the purchase or leasing of qualifying equipment. Cleveland business owners can tell you how complicated it is to write off and track portions of the costs each year in depreciation. Good news: the depreciation schedule has been eliminated from Section 179.
According to Bloomberg, small firms can now purchase up to $500,000 in business equipment and write the investment off completely that year. No more depreciation schedule.
This simplification will not only make accounting simpler and more straightforward, but is also likely to stimulate sales of business-related equipment. In turn, it also seems safe to assume that simpler tax forms and processes will result in fewer audits and other tax issues down the road for owners of small and mid-sized enterprises.
For assistance during and after audits, business owners turn to attorneys experienced finding favorable resolutions with the Internal Revenue Service (IRS). In some cases, audit findings of significant tax liabilities must be taken to court in order to achieve an outcome suitable to a business.
