Pit & Quarry, November 2017
eration when planning to reduce tax bills and avoid potential pitfalls Year end purchases Under the Section 179 first year expensing option an aggregate business is allowed to expense up to 500000 in new equipment purchases Of course the writeoff is reduced if Section 179 property in excess of 2 million increased by inflation is acquired during the tax year Making this election accelerates the write off creating an immediate tax benefit for outlays Bonus depreciation A pit or quarry operation can claim a first year bonus depreciation for purchases of qualifying new unused equipment and software put to use before the years end The 50 percent bonus depreciation is on top of any allowable Section 179 deduction The bonus phases down to 40 percent in 2018 and 30 percent in 2019 Abandon Unwanted unneeded equipment or property that has no value to a crushed stone sand or gravel business could be abandoned rather than sold for a nominal amount The resulting ordinary loss on the abandoned property equipment or business asset is fully deductible rather than treated as a capital loss Depending on the property it may be classed as Section 1231 property a loss that may be either ordinary or capital depending on other transactions for the year Repairs New guidelines for differentiating depreciable capital improvements from the immediately deductible repairs kicked in last year Today thanks to a de minimis safe harbor deduction for material and supplies has increased from 500 to 2500 for aggregate businesses that dont have an applicable financial statement With a financial statement an aggregate business can label costs up to 5000 per invoice as materials or supplies without questions from the IRS Business use of vehicles The standard mileage Automatic Text Email Notifications Real Time Drill Down Reports Secure Access For Your Customers 62 PIT QUARRY November 2017 pitandquarry com PHOTO BY MEGAN SMALLEY TAXES Many quarries overlook the refund or credit available for taxes paid for motor fuels LIBRA WEB SERVICES Mobile connectivi ty for the aggregate industry librasystems com 2152561700 Online Quoting Set ting the Standard In Automation Business Integration An aggregate business is allowed to expense up to 500000 in new equipment purchases under the Section 179 first year expensing option
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