The 2009 Stimulus Act and tax cuts

The stimulus act also extends temporary provisions enacted in 2008, allowing business expense deductions of up to $250,000.

Highlights of the Business Tax Cuts:
* 50% Bonus Depreciation
* No cap on total amount of assets
* Applies to all capital assets with IRS life of 20 years or less
* Assets must be purchased in calendar year 2009
* Discretionary, can opt out

Section 179 Expense Deduction:
* Can expense up to $250,000
* Total asset purchases must be capped at $800,000 or lose dollar for dollar benefit up to $1,050,000
* Assets must be purchased in fiscal year beginning in 2009

An organization’s fixed assets are often one of the largest line items on their financial statements, but because of the complexities of depreciation and the logistics of keeping up with potentially thousands of items, large investments are often managed poorly.

For businesses that still rely on antiquated methods for tracking their fixed assets and managing depreciation, frequent changes to tax law, such as the 2008 and 2009 stimulus acts, can be a time-consuming burden.