The following is information related to the Section 179 tax deduction and COVID-19 restrictions and measures.
Tangible business equipment purchased to modify businesses and/or to conform with COVID-19 restrictions and measures will generally qualify for the Section 179 tax deduction. This includes sanitizing stations, temperature check stations, dividers/plexiglass shielding, new printed signage, and similar business equipment purchased to modify the workspace for employees and/or the public. As always, check with your tax professional or the IRS website for specifics on types of eligible equipment.
Section 179 is Not Affected by COVID-19 Financial Assistance
The Section 179 tax deduction is unaffected by any other government program a company may have participated in. For example, if a company received a forgivable PPP loan due to COVID-19 affecting their operations, they are still eligible to claim a Section 179 tax deduction provided they (a) purchased eligible equipment and put it into service by December 31, and (b) have a taxable income after any adjustments pertaining to the programs they participated.
How Much Tax Can the Section 179 Deduction Save Me?
Section 179 can save you considerable dollars on your taxes, which can be very meaningful for a company affected by COVID-19. Use this free Section 179 Calculator to calculate your tax savings.
Financing Equipment and the Section 179 Deduction during COVID-19
Companies may still finance equipment and take a Section 179 tax deduction. Again, this is irrespective of any other programs a company may or may not have participated in. The usual Section 179 parameters remain: must have purchased (or financed/leased) eligible equipment, put it into service by December 31, and also have a taxable income. See this Section 179 Qualified Financing page for more information.
For further information on Section 179 and COVID-19, check back with this page periodically, or ask your tax professional.