If you read here at all, you know I’m big on Section 179. It’s only the best tax deduction available to small and mid-sized businesses, and can make a huge difference in your bottom line.
*For those who don’t know, Section 179 allows businesses to write off the full price of qualifying equipment (which is almost anything a business can use), up to a little over $1 million dollars. It’s good for any qualifying equipment purchased and put in service during the tax year.
One reason I mention Section 179 so often is sooo many companies do not know about this tax deduction. Believe me when I tell you, eyes are opened wide when we explain it. The conversation usually goes like this:
Wait, you’re telling me I can write off the entire $50k of this purchase? That means (does math) I will save $17,500 in taxes. Is that true?
Yes, that’s absolutely true (the above assumes a 35% tax rate).
So my question to you is this: if you sell to businesses, are you telling every single customer about this? And if you aren’t, why not? Because I’ll bet anything a good number of them are NOT aware of this.
Telling a prospective customer they can write off the entire price (thus knocking whatever their tax rate is right off the true cost) can very quickly turn a “no” or “maybe later” into a full-on “yes”. Any good salesperson will salivate when told a customer doesn’t know about Section 179.
Here in 2021, there’s an added incentive: as I’ve been mentioning time and time again, supply chain delays will have an effect on Section 179 – you need to get the equipment and put it into service. So having equipment in stock and ready to ship is a HUGE selling point.
If you sell to businesses, and have stock ready to ship, I can think of no better incentive than making prospective customers aware of Section 179, and you can get them their equipment in time to take advantage of it.
Section 179 is a great sales tool. Use it.