By Steve Wuest on Wednesday, 06 December 2017
Category: Uncategorized

How to Maximize Tax Benefits from Buying Property

Many businesses have long-term assets on their balance sheets.  For an asset to be considered long-term it needs to be held on a company’s balance sheet for more than a year and cannot be intended for sale.  Examples of long-term assets include physical assets such as property, plant and equipment (PP&E) – machines, buildings, office equipment, vehicles, fixtures, land, computers, etc.  These are all tangible assets.  However, there are some intangible assets that are considered long-term such as goodwill, patents, research and development, and copyrights.

When a business has long-term assets, there are many tax benefits potentially available.  Some of these include:

Depreciation:

What the proposed tax bills could mean for depreciation methods:

Like-Kind Exchanges:     

What the proposed tax bills could mean for like-kind exchanges:

Current New York Tax Credits available for purchasing and/or developing property:  

Non-Income Tax Considerations:

Other Tax Planning Ideas:

There are additional limits and considerations to keep in mind under all of these strategies.  As the government continues to work on finalizing a tax bill, all we can do is theorize on what we think may happen.  Once a final tax bill is pushed out, I am sure there will be many other tax planning implications to understand.  We will keep you posted on new developments.  In the meantime please contact a member of our tax team today to learn more about current tax savings strategies for purchasing long-term assets.       

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