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The Section 179 and Section 168(k) Expensing Allowances ...

The Section 179 and Section 168(k) Expensing Allowances : Current Law and Economic Effects Gary Guenther Analyst in Public Finance May 1, 2018 Congressional Research Service 7-5700 RL31852 Section 179 and Bonus Depreciation Expensing Allowances Congressional Research Service Summary Expensing is the most accelerated form of depreciation. Section 179 of the Internal Revenue Code allows a taxpayer to expense (or deduct as a current rather than a capital expense) up to $1 million of the total cost of new and used qualified depreciable assets it buys and places in service in 2018, within certain limits. Firms unable to claim this allowance may recover the cost of qualified assets over longer periods, using the depreciation schedules from Sections 167 or 168. While the Section 179 Expensing allowance is not expressly targeted at smaller firms, the limits on its use effectively tend to confine its benefits to such firms.

placed in service between September 28, 2017, and December 31, 2022. There is considerable overlap between the property eligible for the Section 179 and Section 168(k) expensing allowances. Since 2002, the two allowances have been used primarily as tax incentives for stimulating the U.S. economy.

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