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Stephen G.
Stephen G., Sr Income Tax Expert
Category: Tax
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Experience:  Extensive Experience with Tax, Financial & Estate Issues
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What is the Section 179 purchases limit in 2013 & what is the

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What is the Section 179 purchases limit in 2013 & what is the maximum deduction? Also, is bonus depreciation still in effect for 2013?

Stephen G :

Hi & thanks for using our service. I'll do my best to give you a complete & accurate answer. Please ask me to clarify anything that is not clear.

Stephen G :

Well, although I haven't read it myself at the moment, the new tax law that the President is about to sign into law includes a provision that allows 50% bonus depreciation.

Stephen G :

I know of no change in the Section 179 limits for 2013, but let me recheck now.

Stephen G :

2013 IRC 179 is 25,000.

Customer:

I will wait for your feedback. Thank you.

Stephen G :

Bonus is a 50% & begins to phase out with acquisitions over $200,000.

Stephen G :

Re above the 179 begins to phase out with acquisitions over 200K not the bonus depreciation

Stephen G :

If you need to contact me again with any tax or financial questions, you can just ask for "Steve G" at the beginning of your question. Again, please remember to rate my response. Bonuses, where you think they are warranted, and excellent ratings, are always most appreciated. Thanks again for using JustAnswer.com.

Stephen G :

Update: Those 179 limits were based upon existing law prior to enactment of the "American Taxpayer Relief Act" (aka New Tax Law just passed by Congress awaiting Presidential Signature) - The 179 limits for 2012 have been extended to 2013, so there is a $500,000. limit with the phase-out beginning at total acquisitions of $2,000,000. That is the final version that the President said he will sign.

Stephen G :

And as stated the bonus depreciation of 50% has also been extended.

Customer:

What is the maximum Section 179 deduction for 2013?

Stephen G :

$500,000.

Customer:

I thought the 2012 179 limits were that a taxpayer could expense up to 139,000 with a purchase limit up to 560,000?

Customer:

I thought the 2012 '179' limits were that a taxpayer could expense up to 139,000 on purchases of up to 560,000 & there was 50% bonus depreciation with no limits? Are you saying that 500,000 can be expensed under Section 179 for 2013 & the 50% bonus depreciation begins to phase out with purchases over 200,000?

Stephen G :

The law on 179 is as stated. $500,000. with purchase limit of $2,000,000. These limits pertain to both 2012 to 2013.

Stephen G :

The 179 pertains to both new & used equipment.

Stephen G :

The bonus depreciation for both 2012 & 2013 is 50%, and applies to new equipment having a MACRS recovery period of 20 years or less.

Stephen G :

The limits you quote do not apply to either 2012 or 2013.

Stephen G :

There is no investment limitation for the bonus depreciation.

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