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Want to Help Stimulate the Economy…?

… and benefit your business at the same time?  Read on, and we will tell you how!  Taxes, that inevitable, unavoidable monster we all must face every year.  However, for 2010, the IRS has made things a little less painful for businesses investing in new equipment and software and other capital expenses.  A capital expense consists of all costs incurred by a business for purchasing assets which have life spans of a year or more and improve the overall quality of the output of the business. Ordinarily, businesses can recover the cost of capital expenditures over time based on a depreciation schedule.  In 2008 and 2009, in an effort to help businesses and spur the economy, Congress temporarily permitted businesses to recover these costs more quickly by allowing the write-off of the cost of depreciable property placed in service in those years.  For the taxable year 2010, Congress has once again extended the bonus depreciation.  The limit under Section 179 of the IRS Tax Code is $500,000, with the deduction phasing out dollar-for-dollar as capital expenditures exceed $2 million. The time to take advantage of this program is now!  The capital equipment must be placed into service between January 1, 2010 and December 31, 2010.   All businesses purchasing or financing less than $2,000,000 in business equipment during the 2010 tax year should qualify for the Section 179 Deduction.  The equipment and software must be used more than 50% of the time for business purposes to qualify.  If the equipment and software expenses are $500,000 or less the entire cost can be written-off on the 2010 tax return.  Businesses purchasing amounts greater than $500,000 can still benefit from the deductions and those that exceed the $2 million in capital expenditure threshold can take a bonus depreciation of 50% on the amount that exceeds the limit.  These businesses can also take normal depreciation on the rest.  Not bad! Now is the time to make the technology purchases you’ve been putting off.   A new network can help your business become more efficient, secure your most important data, and scale to meet your needs in the future.  Falcon Tech has many products available to help you grow your business.  However, we strongly encourage you to check with your financial advisors and tax accountants prior to purchasing equipment in order to fully understand Section 179 and how it affects your business.