The short answer, is yes. Before you jump the gun and celebrate the New Year, you should be aware that by holding off to purchase new equipment in the new year, you may be missing out on thousands of dollars in savings. If you’re not familiar with Section 179 of the US Tax Code, this decision could result in significant loss.
What Is Section 179?
Section 179 is a provision in the U.S. tax code that enables businesses to deduct the full cost of qualifying equipment in the year it’s purchased and placed into service, rather than depreciating the cost over several years. This immediate tax deduction makes it easier for businesses to maintain cash flow and invest in growth. While this has been part of US Tax Code since 1958, it's often overlooked by organizations when considering their end of year budgets. And, like many codes, there are often changes to the rules and allowances from year to year.
For 2024, the Section 179 deduction limit is $1,220,000, with a phase-out threshold of $3,050,000. If your total equipment purchases exceed $3,050,000, your deduction is reduced dollar-for-dollar. Once purchases hit $4,270,000, the deduction is eliminated.
These limits make Section 179 especially beneficial for small and medium-sized businesses, which are less likely to exceed the cap.
Can Section 179 Help You Save on Office Equipment? Absolutely!
Eligible equipment includes tangible property like machinery, office furniture, computers, and, yes, office equipment, including copiers, desktop and multifunction printers. The incentive applies to both new and certified preowned equipment, as long as it’s new to you and placed into service during the current tax year. Some off-the-shelf software can also qualify, so speak to your tax expert before making any final decisions.
To qualify for the deduction, the equipment must be used at least 50% of the time for business purposes, which a new copier would more than satisfy.
But time is running out so take advantage of these savings before the year-end deadline!
Why Use Section 179 for Office Equipment?
Here’s why upgrading your office equipment now can be a smart move:
- Save Money: Deduct the full purchase price of new equipment, reducing your taxable income and lowering your tax bill.
- Boost Productivity: Modern printers and copiers offer faster speeds, better reliability, and advanced features like wireless printing and enhanced security.
- Improve Cash Flow: Use the tax savings from Section 179 to reinvest in other critical areas of your business.
- Flexibility with Financing: Section 179 applies to both purchases and qualifying leases, so you don’t need to pay the full cost upfront to benefit from the tax deduction.
Example: If your business buys a $20,000 copier this year and you're in a 30% tax bracket, the Section 179 deduction could save you $6,000 in taxes, bringing your effective cost down to just $14,000. But you’ve only got a small window of time left to make this decision.
How New Equipment Can Boost Employee Morale
Investing in new equipment isn’t just about improving efficiency and cash flow—it also shows your team that you value their time and effort. Employees who struggle with outdated equipment often face frustration, which can lead to decreased morale.
By upgrading to faster, more reliable printers and copiers, you’ll improve workflows and demonstrate a commitment to creating a more efficient and enjoyable work environment. Modern printers with features like touchscreens, mobile printing, built in solutions and faster processing speeds can make a big difference in employee satisfaction.
Year-End Review: A Smart Time to Upgrade
As the year draws to a close, it's the perfect opportunity to evaluate your budget and business needs. Funds that haven’t been allocated can often go unnoticed, and those dollars might be better spent on equipment that improves productivity, rather than going unused.
This is also the time of year when businesses identify inefficiencies. If outdated printers are slowing down operations or if repair costs are mounting, now is the time to act. Not only can you address these issues, but you can also take advantage of Section 179 before the deadline.
Don’t Wait—Procrastinating Can Cost You
Upgrading equipment may not always feel urgent, but delaying can hurt your business in several ways:
- Lost Productivity: Outdated equipment can break down frequently, slowing down your workflow and costing valuable time.
- Missed Deadlines: Equipment failures can delay projects and hurt client relationships.
- Security Risks: Older machines lack modern security features, putting sensitive data at risk.
The combination of Section 179 and year-end discounts makes this the perfect time to invest in new equipment.
How to Take Advantage of Section 179 Before the Deadline
To claim the Section 179 deduction in 2024:
- Choose Qualifying Equipment: Make sure your printer or copier meets the IRS guidelines for Section 179.
- Purchase or Lease by December 31, 2024: Equipment must be bought or leased and placed into service by the end of the year.
- Claim Your Deduction: Work with your tax professional to file IRS Form 4562 with your return.
Leasing Options for More Flexibility
Leasing is a great option if upfront costs are a concern. Section 179 applies to qualifying leases, such as $1 buyout leases, which means you can claim the deduction even if you don’t pay the full price upfront. This option allows businesses with tighter budgets to still take advantage of the tax benefits.
Your Next Steps
The clock is ticking. Upgrading your office printers and copiers now can give your business a significant tax break while positioning it for success in the new year. Don’t miss out—your savings, productivity boost, and employee satisfaction are just a purchase away.
Make the most of Section 179 before the year’s end—act now to save big!
