Final answer:
The Section 179 deduction allows businesses to expense the full cost of qualifying property in the year it is placed in service, such as machinery, equipment, vehicles, and furniture.
Step-by-step explanation:
The Section 179 deduction allows businesses to deduct the full cost of qualifying property in the year it is placed in service, rather than depreciating it over time.
This deduction is often used for tangible personal property, such as machinery, equipment, vehicles, and furniture, that is used in the course of the business.
However, there are certain limitations and restrictions on the types of property that can be expensed using the Section 179 deduction, including:
- Property used mostly (more than 50%) for business purposes
- Non-real estate property (i.e., not land or buildings)
- Property that is purchased or financed
- Property with a useful life of more than one year
- Property that is not acquired from a related party
It's important for businesses to consult with a tax professional or refer to IRS guidelines for specific details and eligibility requirements.