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Eight tax benefits that every manufacturer should explore

Manufacturing is a highly valued industry in the United States.

Manufacturing is a highly valued industry in the United States.

That may be a factor why there are so many tax benefits for the industry.

Whatever the reason, the fact remains there are a lot of very helpful tax benefits for manufacturers.

Not every tax benefit will be useful to every manufacturer, but there may be some you aren’t taking advantage of that could help your company’s profitability.

These tax benefits are lucrative and should be explored by every manufacturing business:

SECTION 179 DEPRECIATION FOR EQUIPMENT PURCHASES

You may be able to immediately write off any equipment purchases up to $500,000. Congress recently made this tax benefit permanent, allowing for far-greater tax planning.

BONUS DEPRECIATION FOR EQUIPMENT PURCHASES

This is for new equipment only (Section 179 can be for new or used), and it can add up to big savings.

Bonus depreciation allows you to write off 50 percent of the asset cost in the first year, and then you can depreciate the other 50 percent over five to seven years. This benefit will be reduced to 40 percent in 2018 and to 30 percent in 2019.

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