Whether you’re buying a loader, excavator, or another type of equipment, ‘tis the season to take advantage of year-end tax benefits. Plus, some of the best sales programs of the year are often available at this time. If you’re considering an end-of-year equipment purchase, here’s what to know before you step into the dealership.
“There are some really good tax benefits every year with Section 179 and bonus depreciation rules that have been implemented that make it just a great time to buy,” says Ben Potter, sales incentive financial analyst at Bobcat.
Section 179 in the IRS tax code allows qualifying businesses to potentially deduct the full purchase price of a qualifying piece of equipment purchased or financed during the tax year. That means if you buy (or lease, in some cases) a qualifying piece of equipment, you can deduct the full price from your gross income. The deduction can be substantial. For example, let’s say you purchased a $100,000 piece of equipment and your tax rate of 35%. With Section 179, your tax deduction could be up to $30,000.
Visit Section179.org for more information, including a Section 179 calculator that allows you to estimate your deduction, bonus depreciation deduction and the new, lowered cost of the equipment. Every equipment and business owner’s circumstance is different; contact your trusted tax professional to get a more in-depth look at your current position and to make sure your equipment purchase qualifies for Section 179.
Because there are so many business owners looking to take advantage of Section 179 tax deductions – not to mention planning for business growth in the new year – equipment manufacturers have responded with special year-end sales offers and programs. Even business owners who don’t qualify for Section 179 would do well to consider the best-in-class offers that crop up at this time of year.
Almost across the board in December, “pricing is very advantageous to the customers,” Ben says. Not only can buyers potentially reap the tax benefits of a new purchase, they can get their equipment at a good price. Bobcat is no exception. Take advantage of special financing offers through our sales programs now.
Leasing vs. Buying Equipment
Typically, there are three types of equipment buyers: the cash buyer, the financing buyer and the leasing buyer. At this time of year, there are benefits for each.
A full cash buyer comes in to buy equipment. These customers come with “cash” ready to purchase and get special incentives for it.
“We have special program rebates for cash buyers,” Ben says, which can substantially lower the total purchase price.
The second type of equipment buyer requires financing that has very attractive interest rates. Current interest rates are as low as 0% for 60 months and in some cases, customers can also get a finance target model rebate.
The third type of equipment buyer – a lease buyer – doesn’t want ownership. “They like to turn their equipment over and they like to manage their cash flow,” says Ben.
Plan Your Next Business Move
Are you ready to start planning year-end equipment purchases? Connect with your local Bobcat dealer to decide which products to add to your fleet this season. And take advantage of special financing offers through our sales programs now.