On Wednesday, December 20th, Congress passed the new tax bill that promises tax reductions for employees and improvements for smaller manufacturing companies, among other benefits. But what does it mean for people who wish to trade in their machinery and upgrade their equipment? Well, there’s actually a lot to look forward to.
Once the tax plan goes into play, which will be around early February of 2018, you can see immediate benefits if you decide to trade in or purchase new equipment, including that you will be able to immediately write off any new tools, equipment, or machinery you purchase. Under the old law, businesses had to consider depreciation when filing their taxes, meaning the cost of purchasing that equipment had to be spread out over a couple of years. Now, certain equipment purchased between September 27, 2017 and January 1, 2023, you can get an immediate write-off. So if you were thinking about purchasing new equipment, acquiring new used equipment, or trading in machinery for an upgraded batch, this new tax bill is in your best interest.
The tax bill will also introduce a huge change in machinery trading: the tax write-offs will now include used tools, a huge change from the previous law. This means that even if you choose to purchase used equipment for your business, you’ll be able to write them off immediately as well.
According to Bloomberg, you will be able to fully and immediately deduct the costs of both new and used equipment under the new tax bill.
One thing that can make us fall behind the competition is not having the right or most updated equipment needed to keep up. This change allows business owners to purchase machinery and equipment and then immediately reap the tax benefits, creating more of a financial incentive to invest in new equipment. While not for certain, more people involved in machinery trading could mean leveling the playing field for businesses throughout the United States to compete with each other and foreign companies.
At FMI Trading, LLC, we trade and sell manufacturing equipment, including band saws, press brakes, ironworkers, cranes, forklifts, squaring shears, and much more! As 2018 rolls around, we hope to continue selling and trading with communities throughout the El Paso area. So as this new tax bill comes into play, why not take advantage of it by upgrading your equipment and machinery? Contact us today!