The Economic Stimulus Act of 2008 Means Significant Cost Savings for Your IT Purchases
On February 13, President Bush signed the Economic Stimulus Act of 2008, resulting in some very positive tax benefits for technology purchases made in 2008.
Section 168(k) of the act reads:
A Taxpayer is allowed to claim a special 1st year deprecation allowance of 50%, up to a maximum of $250,000, for new property acquired & placed in service in 2008. This special depreciation allowance is in addition to the regular depreciation deductions.
What does this mean for you? Possibly, savings of hundreds of thousands of dollars!
Here's a practical example:
| Before Tax Act |
|
After Tax Act |
| $400,000 |
Technology Infrastructure
Purchase Price |
$400,000 |
| -- |
2008 Special Deduction |
$250,000 |
| $80,000 |
Normal MACRS Depreciation,
Year 1 |
$75,000
(cost minus $250K X 50%, for 2008 only!) |
| $80,000 |
Total 2008 Depreciation |
$325,000
($250K + $75K) |
| 35% |
Estimated Depreciation
Tax Rate |
35% |
| $28,000 |
Estimated Depreciation
Tax Savings |
$113,750 |
| |
Difference of $85,750 |
|
| $372,000 |
Purchase Price of Technology Infrastructure After Tax Savings |
$314,250 |
In addition to our technical design and planning services, Mainline provides financial services to assist you in planning every aspect of your technology purchase. As you evaluate your infrastructure plans for 2008, consider how you can best leverage these tax benefits. Contact your Mainline representative for more information, or call us toll-free at 866.490.MAIN (6246). You may also complete our online request form and a representative will follow-up with you.
Mainline and Mainline Financial Services do not, nor intend to, offer or provide tax or accounting advice to customers. Customers should consult with their own financial and legal advisors. Any tax or accounting treatment decisions made by or on behalf of the customer are the sole responsibility of the customer. |