"The Protecting Americans from Tax Hikes Act of 2015" passed both the House and Senate last week and will be signed into law in the next few days — expanding the Section 179 deduction limit to $500,000 from the previous $25,000.
As detailed on http://www.section179.org, “Section 179 will be permanent at the $500,000 level. Businesses exceeding a total of $2 million of purchases in qualifying equipment will have the Section 179 deduction phase-out dollar-for-dollar and completely eliminated above $2.5 million. Additionally, the Section 179 cap will be indexed to inflation in $10,000 increments in future years. 50% Bonus Depreciation will be extended through 2019. Businesses of all sizes will be able to depreciate 50 percent of the cost of equipment acquired and put in service during 2015, 2016 and 2017. Then bonus depreciation will phase down to 40 percent in 2018 and 30 percent in 2019.”
Leading up to this vote, NPMA and others groups encouraged Congress to act to raise the Section 179 deduction level. Section 179 of the IRS tax code allows businesses to deduct the full purchase price of qualifying equipment from gross income from the year the equipment was purchased, rather than writing off the depreciation of the equipment over several years. It's an incentive created by the U.S. government to encourage businesses to buy equipment and invest in themselves. Qualifying property includes equipment (machines, etc.) purchased for business use, tangible personal property used in business, air conditioning and heating units, business vehicles with a gross vehicle weight in excess of 6,000 lbs., computers, software, office equipment and office furniture.