U.S. brewers have a big incentive to purchase equipment before the end of the calendar year through Section 179 of the IRS tax code.
Section 179 is an incredibly helpful tax tool that allows small-to-medium-sized businesses to deduct the full purchase price of business equipment that was purchased or financed during the 2018 calendar year. Section 179 can help with quickly mitigating the costs of new equipment by allowing U.S. companies to deduct the purchase price of equipment on their 2018 tax returns.
To qualify for the deduction, brewers must have the equipment in service by December 31st, 2018. We still are able to deliver non-customized kegs through our U.S. warehouses before the year’s end, so act fast and request a quote now to take advantage of Section 179 this year!
As an example, say a brewer purchases or finances a brewhouse, tanks, kegs, and a keg washer for $200,000 during the 2018 calendar year. Instead of writing off $50,000 a year for four years, Section 179 allows brewers to write off all $200,000 in equipment costs on their 2018 tax returns and deduct the entire purchase price from gross income.
There are limits to Section 179: you can only write off up to $1,000,000 for 2018, and Section 179 is limited to $2,500,000 for the total equipment purchase price. As Section179.org states:
“There are caps to the total amount written off ($1,000,000 for 2018), and limits to the total amount of the equipment purchased ($2,500,000 in 2018). The deduction begins to phase out on a dollar-for-dollar basis after $2,500,000 is spent by a given business (thus, the entire deduction goes away once $3,500,000 in purchases is reached), so this makes it a true small and medium-sized business deduction.”
For brewers looking to finance their kegs and take full advantage of Section 179, NDL is partnered with Ascentium Capital. Through Ascentium, we can provide a variety of financing terms and options. Ascentium Capital also has a helpful Tax Deduction Calculator to help you determine your tax savings on your annual equipment purchases through Section 179.
If you’d like to get an un-customized keg order in before the end of 2018 to take advantage of Section 179, please request a quote on our website or give our U.S. office a call at 248-850-8275. However, act fast as the window of opportunity for capitalizing on Section 179 is closing!