Something of grave concern to all of us come tax time is how much we need to pay Uncle Sam in federal income tax. Often, as our accounting personnel calculate these numbers, we enter the April dog days of pulled hair, chewed nails, and throbbing temples.
This time around, however, there is some good news that should make tax time a bit more bearable. There are substantial federal tax incentives pertaining to imaging equipment purchases in 2012 which can ultimately impact the amount of one’s federal income tax obligation. Briefly, under the Jobs Act of 2010 and the Tax Relief Act of 2010, medical practices that spend $500,000 or less per year on qualified equipment can write off up to $125,000 in 2012 under the section 179 deduction.
These rules are designed for small and mid-sized practices, so the $125,000 deduction is reduced dollar-for-dollar for qualified expenditures over $500,000. The dollar amounts will be indexed for inflation and, of course, companies cannot write off more than their taxable income.
The expense deductions are provided for taxpayers (other than estates, trusts or certain non-corporate lessors) who elect to treat the cost of qualifying property as an expense rather than a capital expenditure. This could result in the practice and/or its principals paying less in federal income tax.
There are some caveats to note, though:
- Not all states follow federal tax law
- The equipment must be installed and available for use by December 31, 2012 in order to utilize the 2012 tax incentives.
- As each medical practice's situation is different, it is advised that you contact your tax adviser for further detail or visit www.irs.gov for specific details.
As we find ourselves hurtling into the twilight months of 2012, the last moments to take advantage of these tax incentives will be upon us soon. If you’re looking for a particular piece of equipment or are on the fence regarding which unit will best suit your needs, feel free to to learn more about whatever modality you’re in the market for.
A special thanks to Dex Dean of Coastal Leasing for pointing out this opportunity!Find out more about recent legislation affecting the imaging market: