With 2011 quickly coming to an end, make sure to take advantage of a the Small Business Jobs & Credit Act of 2010 before it’s too late. The tax break permits restaurant owners to write off $500,000 in NEW equipment. Here’s an example to help you better understand the tax incentives.
If you purchase:
- Vulcan Double Deck Electric Convection Oven = $6200
- True 3 Door Stainless Steel Pass Thru Back Bar Cooler = $4043
- Champion Low Temp 12″ Opening Glass Washer = $5520
Total Price $15763
With the tax break the cash Savings on your Equipment Purchase would be $5,517.05 reducing your equipment cost to $10,245.95. (of course, don’t forget this purchase will also earn you
Tax cuts were taken a step further this year as restauranteurs can also write off a 100% bonus depreciation on new equipment purchased between September 8, 2010 and December 31, 2011. In the event that your business is not profitable in 2011, you can use the 100% Bonus Depreciation and carry forward any loss to future profitable years. According to Nation’s Restaurant News, “This provision allows the taxpayer to expense, in the year placed in service, 100 percent of the cost of never-before-used fixed asset additions, without any limitations.”
So, what does this mean for you? In essence, if you were unsure about trading in your old oven, walk in cooler or freezer, dishwasher, etc… prior to reading this blog, rest assured that there is no better time than the present to do so. You can’t afford not to!