We’ve been asking, “What’s the best way to economize on technology costs in this economy?” And you’ve been answering…
Anita Campbell
CEO of Small Business Trends LLC
SmallBizTrends.com
I would not delay spending — just the opposite. You can save money by spending smart.
How? By making sure you are taking advantage of 2 significant tax benefits that were extended as part of the Stimulus bill:
- Section 179 of the Federal income tax code allows you to write off certain expenditures in a single calendar year, instead of depreciating them over a number of years – giving an immediate tax benefit for 2009. Businesses can deduct up to $250,000 for purchases of equipment, including computer hardware and off-the-shelf (i.e., non-custom) software, in 2009.
- To the extent that you cannot take the Section 179 deduction, you may be able to claim a bonus first-year depreciation of 50% of the remainder of the cost of the items purchased.
In effect these two provisions mean that the government is “subsidizing” your IT purchase, through tax benefits.
Add to that strategies such as using Web-based software-services (which usually spread out the cost monthly instead of requiring up-front licenses); the increased computing power you can get from upgraded machines; and the energy savings from today’s more efficient equipment (especially if you use the power-management options that are increasingly built it) and the savings can be layered on. The accumulated savings, along with the tax benefits, really add up.
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