Maximize Your Deductions: The New Section 179 Tax Deduction Limits for 2024
Running a business isn’t cheap, especially for small business owners. Every dollar counts, especially when it comes to taxes. That’s where the Section 179 Tax Deduction comes in, offering a golden opportunity for small and medium-sized business owners save big while upgrading their equipment. Advertising and marketing expenses to attract new customers can also be deducted under Section 179.
And we’re going to show you how.
Below, we’ll break down what Section 179 is, how it works, and why now is the perfect time to take advantage of it.
What Is the Section 179 Tax Deduction?
Section 179 tax deduction is a provision in the U.S. tax code designed to help businesses invest in themselves. Unlike traditional depreciation, which spreads deductions over several years, Section 179 allows you to deduct the full purchase price of qualifying equipment and technology in the year it’s bought and put into service, as allowed under IRS guidelines. It turns major purchases into deductible expenses.
For 2024, the deduction limit has been increased, allowing businesses to write off up to $1,160,000 in qualifying purchases, with a spending cap of $2,890,000. These increases make it even easier for small business owners (and even larger ones) to save big on essential upgrades.
What Equipment, Technology, and Machinery Qualifies for Section 179?
The Internal Revenue Service (IRS) allows a wide range of purchases to qualify as Section 179 eligible equipment, including:
- Telecom systems (like business phone systems and VoIP solutions)
- IT infrastructure, such as servers, hardware, and software
- Business equipment like computers, printers, and copiers
- Machinery and tools used in operations like excavators, packaging equipment, or CNC machines
- Certain off-the-shelf software like CRM, project management tools, and accounting software
- Plus, businesses can also deduct various taxes, such as payroll taxes and real estate taxes under Section 179
While many purchases can be written off under Section 179, there are exceptions to this deduction. For example:
- Real Estate: Buildings, land, and improvements to property are not tax deductible under Section 179.
- Intangible Assets: Custom software or assets that aren’t ready for use by the end of the year might not be tax deductible either.
If you plan to upgrade to any of these systems or equipment in 2024, it’s an excellent time to maximize your Section 179 deductions, especially if you’re a freelancer or consultant, because Section 179 deductions apply to business income, not personal income.
To learn more about section 179, visit the IRS official page for details.
The Big Business Benefits of Applying the Section 179 Deduction
If you’re a small to medium-sized business owner or a CFO managing a tight budget, Section 179 offers tangible advantages for you like:
1. Immediate Tax Relief That Puts Money Back in Your Pocket
One of the biggest advantages of Section 179 is that you don’t have to wait years to claim depreciation on new equipment. Instead, you can deduct the entire cost in the same tax return the year you make the purchase.
Let’s say your business spends $50,000 on some office equipment or a new telecom system in 2024. With Section 179, you can deduct the full $50,000 from your taxable income for the year. At a tax rate of 24 percent, that’s a savings of $12,000—money you can immediately put back into your business thanks to a simple equipment tax write-off.
2. Encourages Business Growth by Lowering Upfront Costs
High upfront costs can make even essential upgrades feel out of reach. Section 179 eases that burden by letting you save on taxes now, freeing up business expenses for reinvestment.
This is particularly helpful for IT and telecom managers who know their systems are outdated but worry about the price tag of modern solutions. With the Section 179 deduction, the money you spend on those upgrades is suddenly a lot more affordable. Whether it’s enhancing network capabilities or installing an efficient phone system, you’ll have more flexibility to invest in what your business really needs.
3. Improves Productivity with Much-Needed Upgrades
Think about the impact outdated systems might be having on your business. Slow networks, unreliable phones, or inefficient processes can drain time and frustrate employees and customers alike. By taking advantage of the small business tax benefits from Section 179, you can replace those bottlenecks with cutting-edge solutions that are faster, more reliable, and built for modern business demands.
For instance, upgrading to a new business phone system can enhance communication, simplify team collaboration, and improve customer service—all while being eligible for a tax deduction for businesses.
Small Business Tax Benefits In Action
Let’s say you’re the CFO of a growing company, and your telecom system is overdue for an upgrade. You decide to invest $75,000 in a new VoIP solution from Dove Communications. Thanks to Section 179, you can deduct the full $75,000 in business costs from your taxable income for the 2024 tax year.
Here’s how it might break down:
- Initial Cost of Equipment: $75,000
- Section 179 Deduction: $75,000
- Tax Savings (assuming a 30% tax rate): $22,500
That’s $22,500 back in your pocket—money you can reinvest in other areas of your business.
How Dove Communications Can Help You Maximize Section 179
At Dove Communications, we know how important it is to make the right technology investments. That’s why we offer a range of Section 179-eligible telecom and IT solutions to help your business run more efficiently, stay connected, and save money. Here’s a quick look at what we offer:
- Business Phone Systems: Upgrade your business phone system to a more modern and flexible platform. Whether you’re looking for a cloud-based system or something more traditional, we have solutions that can help.
- Managed IT Services: Our managed IT services remove the headache of managing your technology. From network security to troubleshooting, we handle it all so you can focus on running your business.
- Telecom Solutions: Need reliable internet, VoIP, or video conferencing? We offer a variety of telecom solutions designed to keep your team connected and productive.
By upgrading your telecom and IT infrastructure with Dove Communications, you can improve your business operations and qualify for Section 179 tax deductions. We’ll help you navigate the tax benefits and identify the best solutions for your needs.
Why Act Now? Key Deadlines and Planning for the 2025 Tax Season
While the benefits of Section 179 are significant, they come with a ticking clock. To take full advantage of the deduction for the 2024 tax year, you need to:
- Purchase and install eligible equipment by December 31, 2024.
- Make sure all systems are operational to qualify for the deduction.
Waiting until the last minute can lead to delays, so it’s wise to start planning now. By acting early, you can beat the rush, lock in the best deals, and start benefiting from your upgraded systems immediately.
And with modern IT and telecom systems in place, you’ll be better equipped to handle the challenges and opportunities 2025 brings your way.
Upgrade Now and Save Big with Dove Communications
The Section 179 deduction is more than just a tax break—it’s an opportunity to invest in your business’s future while saving money now. With the increased deduction limits for 2024, there’s no better time to upgrade your telecom systems, IT infrastructure, and other essential business equipment.
Dove Communications is here to help. We make the process easy by guiding you every step of the way. From identifying eligible equipment to ensuring timely implementation, we’re here to help.
Next Steps:
- Assess your current telecom and IT systems. What needs upgrading?
- Contact Dove Communications to explore your options.
- Invest in Section 179-eligible equipment before the year ends.
Reach out to us today to learn more about eligible equipment and how we can help you save. Don’t wait—plan your upgrades now and reap the rewards when tax season comes around.
