This is a special email from PlanetMagpie about recent changes in tax law that may dramatically change your IT strategy for 2011.
Let's say you spent $50,000 on a new network and computers. According to existing tax law, you could only write off/depreciate around 20% ($10,000) in the first year that the hardware/software was put into service. That means that the other $40,000 is considered taxable income - even if you don’t have it in the bank. Ouch!
That has changed for the period September 8, 2010 to December 31, 2011. Thanks to the Tax Relief Act of 2010, you're able to fully depreciate IT purchases in the year they're put into service. This is a huge relief for CIOs and IT staff. For the next year, they can replace aging servers and software...and write off 100%!
Gerry Clancy, a CPA at Comyns, Smith, McCleary & Deaver LLP, kindly provided us with the following article on the 2010 Tax Relief Act to share with you.
Forward this to your CIO immediately! 2010 Tax Relief Act Information for IT Purchases - From the Office of Gerard Clancy, CPA DISCLAIMER: This information does not constitute legally-binding professional tax advice. Please check with your accountant.