William Byrnes' Tax, Wealth, and Risk Intelligence

Although some items purchased by a business can be written off 100% for income tax purposes in the year of purchase, many types of property are not eligible to be deducted fully in the year they are purchased.  The tax deduction for purchase of a piece of depreciable property is spread out over the life of the property.

Each year during the depreciation period the business is allowed to take a tax deduction for some portion of the purchase price of the property. The Tax Relief Act includes a provision allowing 100% bonus depreciation for some business assets.  It also extends for an additional year the 50% bonus depreciation provisions previously scheduled to expire at the end of 2011.  Read this complete analysis of the impact at AdvisorFX (sign up for a free trial subscription with full access to all of the planning libraries and client presentations if you are not already a subscriber).