ICNC NEWSFEED

Most of our customers invest in Industrial CNC Router Systems to increase their production and profits. That’s a goal which affects many aspects of running the machine; choosing the right software options, laying out your design to get the most yield from your sheet stock with minimal waste, finding the right bits at the best price, choosing the most efficient hold down method, or finding the right employee to run the jobs. We’ve found that many of customers came to us because they were tired of paying a premium to outsource their CNC jobs, and the step forward to bring an Industrial CNC in house just made sense because of the increased profit that comes with that control and capability.

And so, after putting in all of that work to maximize profit, it’s a shame that not everyone takes advantage of available tax strategies, specifically tax code 179, an incentive designed to help keep businesses moving forward and rewarding those who invest in themselves and their own success. In the past, businesses would have the option to make a purchase and then write it off gradually through depreciation over the years. 179 allows you to write off the whole amount the same year you put your machine to work.

Simply put, Tax Code 179 allows you to deduct 100% of the cost of qualifying equipment from your gross income. Of course, your Industrial CNC Router is qualifying equipment, provided it was purchased for business use (business use more than 50% of the time is the requirement.) You must also put the machine into service this year if you plan to claim the deduction for this year. You may have other purchases that qualify as well (software, computer, computer cart, etc.) Just keep in mind that the maximum that can be written off under 179 is $1,040,000 for 2020.

The best part is, you don’t have to make a cash one time purchase to claim 179. Even if you’re financing, you’re still eligible for the deduction, provided you put the machine to work this year. When it comes to maximizing profits and keeping them in your pocket, it’s hard to beat that scenario, a low monthly payment, and deduction of full purchase price, all while your machine is not only paying for itself but making you money.

Tax code 179 is a way to reward you for acting now. It’s common, even for people that know they need equipment, to spend years putting it off “until next year.” Some companies do this because they worry about learning how to operate a new piece of equipment. After all, if you can outsource to someone who will do it for you (at a premium rate,) it’s easy to feel that the need isn’t urgent, or that yo have the work covered.

However, if you’re subbing out the work, you’ll need to mark up your own prices which gives you less room to be an attractive pricing option. Companies that already have a machine and do the work for you tend to be very busy which makes it harder for you to offer a competitive turnaround time. And of course, companies doing sub work for you are not always as loyal as your own employees.

Many that plan to get a CNC Router “one day” don’t realize that while they were considering adding an Industrial CNC Router to their shop capabilities, many companies decided that “one day” was today. Those companies are cutting jobs and offering many services that they couldn’t offer before and they can do the same job 100 times as easily as doing it once. Of course we’re happy to help you whenever you’re ready, whether now or later, but keep in mind that whenever you decide “Now” is, that’s when you can boost your production and your profits. We’re ready to help you today so talk to your tax professional because Tax Code 179 is ready as well.