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Special 179 Deduction Zones that Qualify for Increased Deduction Limits

Section 179 offers businesses located in specific special zones an increase in the overall deduction amounts. The additional deduction amounts vary, depending on which zone your company is currently operating in.

If your company is operating in one of the following zones, you may qualify for the increased deduction limits:

  • New York Liberty Zone
  • Enterprise Zone and Renewal Community Businesses
  • Gulf Opportunity Zone (areas affected by recent Gulf Hurricanes)
New York Liberty Zone

If your business is operating in the New York Liberty Zone, you will qualify for a larger Section 179 Deduction. The New York Liberty Zone is located within the borough of Manhattan - however, not the entire borough of Manhattan qualifies for the New York Liberty Zone additional deduction. The IRS website will give you the specific geographic definition of the New York Liberty Zone.

In the event your business is located in the New York Liberty Zone, the additional deduction available to you breaks down as follows: Your additional deduction is $35,000 or the cost of the Section 179 Property located within the Liberty Zone and placed into service during the year.

Your tax preparer should be aware of the additional New York Liberty Zone deduction. If your tax preparer is not familiar with the New York Liberty Zone Deduction, please make certain that you inform him or her of the additional dollar limits available to your business.

Enterprise Zone and Renewal Community Business Area

If your business is operating in an Enterprise or Renewal Zone, you will qualify for a larger Section 179 Deduction. There are specific areas throughout the United States that have been defined as Enterprise Zones or Renewal Community Zones. Typically, these zones are in metro areas that need to be revitalized; or rural areas that need jobs. The IRS has a more specific definition of Enterprise Zones and Renewal Community Business Areas.

If your business is located in an Enterprise Zone or a Renewal Community Business Area, there are additional Section 179 Deductions available to you. The Section 179 Deduction limits are (again) raised by $35,000 or the cost of the Section 179 Property located within the Enterprise Zone or Renewal Community Business Area.

Your tax preparer should be aware of the additional deduction limits in the Enterprise Zones or the Renewal Community Business Areas. If your tax preparer is not familiar with the additional deduction limits available in the Enterprise Zones or Renewal Community Business Areas, please make certain that you inform him or her of the additional dollar limits available to your small business.

Gulf Opportunity Zone Property

If your business is operating in the Gulf Opportunity Zone, also know as the GO Zone, your business will likely qualify for a larger IRS Section 179 Deduction. The GO Zone is defined as areas affected by hurricanes Katrina, Wilma, or Rita. The Federal Emergency Management Agency (FEMA) has defined certain areas affected by these storms as areas that qualify for a significant bump in the Section 179 Deduction. Please see the IRS website for more detailed definition about GO Zone Property.

If your business is located in the GO Zone, there are additional Section 179 Deductions available to you. The Section 179 Deduction limits are raised by $100,000 or the cost of the Section 179 Property located within the Enterprise Zone or Renewal Community Business Area.

Your tax preparer should be aware of the additional deduction limits in the GO Zone. If your tax preparer is not familiar with the additional deduction limits available in the GO Zone, please make certain that you point out the potential savings to him or her.

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This website was designed to answer your questions regarding the Section 179 Tax Deduction, and to explain the impact the various Stimulus Acts have had on Section 179. The information on this site will clearly explain the Section 179 Deduction in plain terms; will go over what property qualifies under Section 179 for the deduction; and will explore the myriad of ways the Section 179 deduction can impact your bottom line. In addition, there are IRS tax forms and also tools for you to use, such as the free Section 179 Deduction Calculator currently updated for the 2014 tax year.