Here we are, in December. I wrote a “when is the best time of year to finance equipment” for every month, and looking back, it interests me to see that yes, every month has merit, and the reasons change.

And for a lot of companies, December is the best equipment financing month. Here’s why.

Section 179 is really making headway now. If you finance equipment in December, assuming it’s qualifying equipment (most equipment is), you can take a full Section 179 deduction for this year. But since you financed it, you won’t make any payments until next year. So the only thing on your books for this year is a sweet deduction, and new equipment that you get to use. That’s nice.

Side note: The Section 179 Deduction is a fat $500,000, so you likely have lots of deduction potential. Just make sure you buy and get the equipment into service by midnight on 12/31.

Here’s another good reason: There are great deals on equipment right now. Many companies want a fresh start to next year, so you can find a lot of current year equipment getting moved at deep discounts.   

And even if they are hot selling models that aren’t going anywhere soon, many companies will still offer December discounts, just to punctuate the year fiscally and finish with a bang. Either way, there’s a sort of “rush” to December that simply isn’t there other months.

It’s also Holiday Season. Regardless of what you celebrate (or not), it’s a very festive and friendly time of year. Bells and cash registers are ringing, making commerce almost a natural activity.

One last thing: If you’ve had a good year, ending it with a new (or new to you) piece of equipment will bring a smile to anyone’s face. And if your year was less than you hoped, starting next year off with new equipment can help turn things around.

Happy December!!

Twas a night in December
In an office on a hill
Where the executives all gathered
With their accountant named Bill

“Your taxes are too high”
Said Bill with a frown
We have nothing to claim
To bring the number down

“But what can we do?”
The executive VP did vent
Our profits were strong
And into the bank they went

We were told to curb expenses
So the old equipment we did use
Yes, it needed some duct tape
(that’s how Jim got that bruise)

“I have an idea”
said a voice from the right
The executives turned around
To see an intern bathed in light

We can replace the old equipment now
And here’s the part that’s divine
We can write the entire cost off
Thanks to Section 179

The executives all smiled
So wide they almost burst
But intern continued
“You need to act by December 31st“

The executives took action
A plan they did sketch
All because they listened
To an intern named Fletch

And that’s how I got my start. Ok, maybe the “bathed in light” part is a bit much. But it was a good poem, right? Have a great holiday, everyone. And remember, get those Section 179 equipment purchases in (and operational) by the deadline, which is midnight, 12/31.

See you in 2015!

(…on that note, this time of year always reminds me of my office supply store job I had years ago. You would think Dec 30/31 would be slow for a “business” type store, but it never was – in fact, we always had a crush of people buying computers, printers, cameras, office furniture… anything they could to take advantage of Section 179. I know I’ve mentioned that story before, but it’s worth repeating, because it illustrates that to qualify for the current year, your equipment must be purchased and put into use by midnight, 12/31.)

This year, the government actually did something good… they raised Section 179’s limits for 2013. In fact, it’s back up to a healthy $500,000. And this is good for new (or new-to-you) equipment. Considering that it was going to be a paltry $25,000, this amendment is very welcome indeed. But if you are reading these words, there’s little time left – it’s getting close to New Year’s Eve.

Here’s a quick rundown of the type of equipment that generally qualifies:

• Tangible equipment for general business use.
• Tangible personal property that is used in business (partial use qualifies as well. For example, Laptops that are also used for personal computing can be partially deducted.)
• Business Vehicles with a GVW (gross vehicle weight) that exceeds 6,000 lbs. (this means cargo vans, dump trucks, heavy machinery, etc.)
• Computers and “off-the-shelf” software (yay!!)
• Office Furniture and Office Machines (double yay – who doesn’t need a new desk chair?)
• “Installed” equipment that is attached to your property, but is not a structural part of the building (like a loading crane or similar).

There you go – you have a few days left, so hop to it!!

Have a great holiday, and I’ll see you next year.