Section 179 Expensing for Small Business has changed

For taxable years beginning in 2012, the maximum deduction of $125,000 of the cost of qualifying property placed in service for the taxable year is reduced as the cost rises above $500,000.00. The $125,000 and $500,000 amounts are indexed for inflation.  Also extended for 1 year (through 2012):  Treating off the shelf computer software as qualifying property and amending or irrevocably revoking the Section 179 election for a taxable year without the Commissioner's consent. 

For taxable years beginning in 2010 and 2011, the maximum amount that a taxpayer may expense is $500,000 of the cost of qualifying property placed in service for the taxable year.  The $500,000 amount  amount is reduced (but not below zero) by the amount by which the cost of qualifying property placed in service during the taxable year exceeds $2,000,000.  Off the shelf computer software placed in service in taxable years beginning before 2012 is qualifying property. 

For taxable years beginning in 2013, the maximum Section 179 dedcution of $25,000 of the cost of qualifying property placed in service for the taxable year is gradually reduced as the cost rises above $200,000.