The IRS is acting like Oprah, and small businesses across the U.S. are benefiting. Thanks to Section 179, the IRS is handing out a $1,000,000 deduction to every small business that puts qualifying equipment and/or software into use before the end of the year. Rather than depreciating equipment over the course of several years, Section 179 allows businesses to deduct the full price of equipment in Year 1, up to $1,000,000. That’s an enormous tax benefit.
And it gets better: Even if you finance the equipment rather than paying for it up front, you still qualify for the deduction. Leases as well as purchases are included in this rule. You don’t have to hand over a pile of cash in order to reap the Sec. 179 benefit.
Almost any tangible business-related product qualifies for the deduction, including:
- Equipment purchased for business use
- Computers and off-the-shelf software
- Data hardware (essential for imaged-document storage and access)
- Office furnishings and fixtures, including high density mobile storage and lockers
- Office equipment
- Certain business vehicles, including fork lifts and 9-passenger vans
- Property attached to your building that is not part of the building structure (casework and industrial shelving, for example)
- Tangible personal property used in the business, or equipment with a partial business use
- Some improvements to existing business-only buildings, including security systems, HVAC, and roofing
There’s one small but essential thing to remember: The new equipment must be placed into service by December 31.
With only a few weeks left in the year, that deadline may seem like an insurmountable scheduling problem. Luckily, many business-equipment vendors offer quick-ship programs for their clients who want to take advantage of the Sec. 179 deduction. If you’re planning an equipment acquisition in the first quarter of next year, why not buy it now, put it into use before the end of this year, and get the money the IRS put under your seat?
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A deadline is looming for government agencies: By December 31, 2019, they must be able to manage all their records in an electronic format. In the private sector, too, businesses and professional practices have been changing over to electronic record keeping. When your organization’s leaders mandate a move to digital operations, what will that mean for your area of responsibility?
Last year, the director of records management and outreach of NARA (National Archives and Records Administration) issued a useful cost-benefit breakdown that the private sector, as well as the public sector, can utilize for planning a document conversion program. Now that this multi-year conversion effort is nearing its deadline, the same office has published criteria for the successful management of electronic records. And like the cost-benefit analysis, the NARA success guidelines can be applied to private-sector organizations as well.
Among the key benefits of digitization are security, searchability, retrievability, and audit trails. A successful document conversion program will produce these benefits. While the NARA success guidelines are intended for records that originate electronically, a number of the success criteria are applicable to enterprises making the transition from paper to digital documents via an digitization program, including:
- Well-designed access controls that let your organization perform its business functions without additional productivity roadblocks.
- Imaged documents that comply with NARA format and metadata requirements, as well as Sec. 508 regulations, for those enterprises doing business with the federal government.
- Policies that support digital document management, especially organization-wide communication, stakeholder involvement, and personnel training.
When the document conversion mandate comes from your private-sector business’s C-suite, there won’t be an agency like NARA to help guide your transition to electronic records management. But that doesn’t mean you can’t achieve the same document-conversion success that the federal agencies have. Reach out to a specialty vendor or consultant working in the digitization field to have them develop a custom conversion program designed for your specific needs.
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