Tax Law's Section 179 Update

Tax Law's Section 179 Update

There have been some changes to tax law that farmers and ranchers need to be aware of says CliftonLarsonAllen Partner and Farm CPA Today Blogger Paul Neiffer

Neiffer: "One of particular interest to farmers is that Section 179 for 2013 was $500,000 and for 2014 it is all the way down to $25,000. It phases out starting out at $200,000 -- so if you purchase more than $225,000 of equipment or other farm assets during the year you will not be able to take Section 179. Now we think that Congress will get their act together but most likely it will be after the mid-term elections so in December of 2014 I think we will find out what the actual Section 179 for 2014 will actually be and they won't have much time to make a decision."

In addition to the Section 179 changes, he says

Neiffer: "Another change similar to Section 179 is that bonus depreciation is back to being zero percent. Last year for 2013 it was 50 percent, this year it is zero. So between that and the Section 179 dropping down all the way to $25,000 farmers may not have the ability to deduct much of any new equipment purchases that they make during the year."

If you are interested in learning more go to Neiffer's blog, Farm CPA

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