50% Bonus Depreciation in 2010 May Be A Great Deal For Your Business

Here is some important news for your budget planners, controllers, CFOs, CEOs, presidents and anyone else in charge of tax strategy at your firm. This information is provided to keep you abreast of changes in tax law and stimulus legislation that may impact your asset buying decisions. I suggest you talk to your tax advisor about how you can best take advantage of this legislation. You only have until 12/31/2010 to act.

Here is my understanding of what was signed today:

The House approved a bill last week, which President Obama signed into law today, approving a 50% “Bonus” depreciation on qualifying assets purchased in CY 2010. Fortunately the purchase of software is included in the list of qualifying assets. I don’t think real estate assets are eligible. That is something to chat about with your tax advisor.

The Quick Bullets:

• Today, September 28th, President Obama signed into law a bill that includes a retroactive extension of the 50% bonus depreciation provision that expired last December.

• Qualifying businesses get to write off an additional 50% of the cost of certain assets acquired and placed in service in 2010.

• This bill is intended to spur the economy through capital investment
Importantly, this legislation sunsets 12/31/2010, and presents a compelling reason to buy in calendar 2010.

This sounds to me like a great deal for those needing to upgrade or refresh IT infrastructure. For us at Alvaka Networks, I know we will be using it for our investments in our DRworx Backup and Disaster Recovery Services investments