As 2011 draws to a close, so do opportunities for farmers to take advantage of certain provisions of the federal tax code, according to Ohio State University Extension educator David Marrison.
“The ability for bonus depreciation is changing, so if you’re looking to make capital expenditures, this is the year to do it,” said Marrison, one of the leaders of OSU Extension’s Ag Manager Team. “You can depreciate 100% now, it will go to 50% next year, and after that it could go away completely depending on what Congress does.”
Marrison said that over the past decade, Congress has repeatedly allowed faster depreciation of capital assets to stimulate business investment by providing a “bonus” depreciation allowance in the year the asset is purchased.
The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 extended the depreciation bonus for 2011 and 2012 to encourage new equipment purchasing. The additional first-year depreciation rules allow farmers to deduct on their 2011 income tax returns 100% of the cost of qualifying assets purchased in 2011 and 50% of the cost of qualifying assets in 2012.… Continue readingRead More »