It started like any other return; reviewing last year’s income and going through the expenses when suddenly…what is this mine eyes doth see? My client had been depreciating a business asset that could’ve been fully expensed! Can you imagine? Towards the end his depreciation the deduction was at $6/yr. That’s insane! In order to maximize that depreciation he’d have to wait years and the amount would decrease exponentially! Now, he didn’t do anything wrong by depreciating the asset but why depreciate a small asset at $6/year when you can take the full advantage today?
That’s where the the Di Minimus Safe Harbor Election comes in. With this election you can expense business assets up to $2,500 per asset per invoice, and the IRS will provide audit protection to eligible businesses by not challenging this election for years ending before Jan. 1st, 2016.
If you think your business might benefit from this election contact me now to discuss your situation. Simply send me an email to firstname.lastname@example.org Lets see if you qualify for this or other deductions that will keep more money in your pocket.
As always, this is not legal advice and you should consult a professional (like me!) to determine what is right for you and your business.