Making good investments in your business is a foundational principle for success. These investments can take many forms. Investments in people, real estate, programs, events, software and equipment all work together to grow an organization over time. Strong business means a strong economy so the IRS provides a program commonly known as Section 179 that gives huge tax incentives for new equipment. If your looking to buy an LED sign, now is the time.
What is Section 179?
The IRS outlined this program in Section 179 of the tax code (hence the nickname), but it’s not a complicated program. In a nutshell, you can finance, lease or purchase equipment (or software) for your business up to 2.7 million dollars, then claim the full deduction, and full depreciation on it within the tax year you purchased it.
For Example (2022):
Your New Equipment: $150,000 Section 179 Deduction: $150,000 (up to 1.08 Million) Cash Savings on Purchase: $31,500 (at 21% Marginal tax rate)
Net Equipment Cost After Tax Savings: $118,500
Our friends at Ascentium Capital have some great resources to help understand your options with Section 179.
LED Signs are an Investment
By their very nature, LED signs are designed to produce a measurable return on the money spent. When used properly, they start to pay for themselves immediately with better branding, driving more impressions, and ultimately resulting in more sales. Leveraging Section 179 helps make that return happen even faster with essentially a “discount” on the purchase, lowering your overall cost to invest.
Section 179 and Financing
The benefits you get from Section 179 apply even when financing the equipment. This protects your cashflow and makes it easier to invest into LED sign ownership and get the ball rolling before years end. Whether you use your local bank, a national company, or our partners at Ascentium Capital, financing is one of the best options to get started.
Not Just LED Signs
Most tangible goods used by businesses qualify. This includes business equipment, office furniture, computers, software and technology as well as many other business assets like vehicles. For 2022 you can write off up to 1.08 million on total purchases up to 2.7 million.
Section 179 is an amazing tool to help you invest and grow your business. Paired with an LED display, you can increase your exposure to the public and increase potential revenue. If you’re interested, reach out and we’ll get you connected to a dealer who can help!
