Creating the Perfect Office Design – a NxtWall Case Study
Installing NxtWall Demountable Walls Offers BIG Tax Savings!
How can you save money installing NxtWall demountable walls? Interior demountable walls under Section 179 are classified as furniture and fixtures by the Internal Revenue Service (IRS). Taking this deduction allows businesses to lower their current-year tax liability rather than capitalizing an asset and depreciating it over time in future tax years.
Simply by taking advantage of the IRS Section 179 deduction and the 100% Bonus Depreciation Deduction, companies can substantially reduce the cost of demountable walls and save thousands of dollars the first year the wall system is installed. The 2022 deduction maximum is $1,080,000 which is up $30,000 from last year. This spending cap makes Section 179 a true “small business tax incentive”, because larger businesses that spend more than $3,780,000 on equipment won’t get the deduction. Once the maximum Section 179 deduction of the wall system purchase price is met an additional bonus deduction can then be taken.
The bonus depreciation can be used to add even more savings. According to the Internal Revenue Service, the Bonus Depreciation allows businesses to deduct additional depreciation for the cost of qualifying property, beyond normal depreciation allowances. It is intended to spur capital purchases by small and mid-sized businesses. The rules allow for a Bonus Depreciation of 100% in 2022 for all qualified purchases made before the end of the year. Section 179 together with the bonus depreciation offer companies a strong incentive to put more money back into their businesses and buy now before the bonus deprivation is eliminated or substantially reduced.
Section 179 Deduction
Important Limits for 2022
| Deduction Limit: | $1,080,000 |
| Limit on Capital Purchases: | $2,700,000 |
| Bonus Depreciation: | 100% |
| Must purchase before the end of the year: | 12/31/2022 |
2022 Section 179 Tax Deduction Example:
| Cost of Wall Systems: (assuming a tax bracket of 35%) |
$2,000,000 |
| Section 179 Deduction (for 2022): | $1,080,000 |
| Bonus Depreciation Deduction (100% in 2022): | $920,000 |
| Normal First Year Depreciation: | $0 |
| Total First Year Depreciation: | $2,000,000 |
| Cash Savings on Purchase: | $700,000 |
| Lowered Cost of Walls (after tax savings): | $1,300,000 |
* Tax rules are complex and depend on your individual situation. The NxtWall Tax Saving Calculator is for illustrative purposes only. Information shown with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. Consult your tax advisor to see how financing and Section 179 can benefit you.
NxtWall’s 2022 Tax Savings Calculator:
FEATURED PHOTO
Product: Flex Series
Market: Corporate/Business
Wall Frame Finish: MS Silver
Description: Flex Series 8’ ceiling height 1/4” clear tempered single pane glass offices. Built to existing soffit. Aluminum Framed Glass door (swing) with Cortland 2600 Standard Level Lockset.
See more Flex Series Images
Related posts
