Using Section 179 to Plan Your Year-End Attachment Purchases

The end of the year is approaching. Your equipment needs aren't going anywhere.

For contractors, the final months of the year are a good time to take stock of what worked, what didn't and what equipment could make next year more productive. It's also an opportunity to make purchasing decisions that may provide some tax advantages.

That's where Section 179 comes into play.

Put Your Equipment Investment to Work

Section 179 of the IRS tax code allows qualifying businesses to deduct the cost of eligible equipment purchases, up to applicable limits, rather than depreciating those costs over several years.

For contractors considering new attachments, that can make a difference when planning year-end investments.

Think about the jobs you took on this year. Did you turn down land-clearing work because you lacked the right brush cutter? Spend too much time renting a hydraulic breaker? Lose productivity because an older attachment couldn't keep up?

Those are good reasons to consider an upgrade, regardless of the tax benefits.

Buy for the Work Ahead

A smart equipment purchase should solve a problem or create an opportunity.

Blue Diamond Attachments offers solutions for land clearing, demolition, material handling, road maintenance and more. From brush cutters and mulchers to hydraulic breakers, grapples and cold planers, the right attachment can expand what your existing machine can accomplish.

And unlike purchasing another machine, adding an attachment may allow you to take on additional work using equipment you already own.

Timing Matters

To potentially qualify for a Section 179 deduction for the current tax year, eligible equipment generally must be purchased and placed into service before December 31.

That means ordering an attachment isn't necessarily enough. It needs to be ready and available for business use.

Section 179 also has annual deduction limits, taxable-income restrictions and business-use requirements. Consult your tax professional to understand how these rules apply to your operation.

Finish the Year Looking Forward

Nobody should purchase equipment simply to get a tax deduction. But if you've already identified an attachment that can improve productivity, reduce rental expenses or open the door to new business, year-end may be an ideal time to act.

The right investment can help you finish this year with a plan and start the next one ready to work.