Are You Upgrading Your Equipment Now Or Later?

Black Friday followed by Cyber Monday was the day for SHOPPING. The real question is what equipment is on your business shopping list. It is all a question of your budget, income, cash flow, profit & loss and Taxes.

What Do Your Need?

If You Are Planning - To make a purchase and can’t decide when – Let me help simplify it.

If You Buy Before - The end of the year – Internal Revenue Code – Section 179 allow for an accelerated depreciation. If your purchase is less than $500.00 it is usually always an allowed expense.

It’s The Bigger Stuff - Vehicles / Tools Mounted On A Trailer / Generator / Specialty Equipment

Depending On Type - Life span and cost basis can trigger other tax reporting rules. The Section 179 accelerated depreciation has been in place for many years.

It’s Easy To Assume - The deduction will always be available. Congress decides what changes year over year is in the details inside the deductions. At one point (several years ago) vehicles over a certain weight (SUV’s) had a cap on the depreciation deduction. They were considered a luxury vehicle and the extra features were unnecessary over the basic pickup truck.

It’s Also The Items - In smaller packages – Computers / Laptops / Tablets / Miscellaneous Hardware / Software

There are three main reasons the Section 179 accelerated depreciation went into effect.

Stimulate local economy – Some purchases such as QuickBooks is purchased at local stores
Give business a reason to grow and expand by adding new equipment and additional employees
Useful life ended long before the depreciation schedule ended which was years later

Everything comes back to two issues: Taxes and Cash Flow

If You Have The Cash - Or can finance do you need to buy a piece of equipment for The Field?

If You Have The Cash - Or can finance do you need to buy a piece of equipment or software for The Office?

From An Operations Viewpoint - If you purchase either now; can you use it to make or save money?

Marginal Cost vs. Marginal Revenue - Analysis could provide you the information you need to make an informed intelligent decision.

See Our Strategy Pages - “What’s 10 minutes costing you” / “What is the cost of a field employee” / “What is the cost of an in-house bookkeeper” / Construction Business Strategy

Just An Idea - A wheelbarrow and a shovel is cheaper but would a small Hitachi be more productive and cost less in long run which could give you more money to operate and grow your construction business?

Investing In A Smart phone - Is the efficient and effective extension of your business. The old saying “Time Is Money” is true…anyone seen a working payphone lately?

Now Is The Time - To review your office equipment. Yes – that old desktop computer with an Intel 486 processor running Windows XP still works; however, does it work with the new software?

Many Contractors Use - Their truck as an office. So even more basic…

Do you have a real desk?
Is your chair comfortable to sit in?
Large dual monitors are easier to see and reduce eye strain.

Cash Flow - Do you take credit cards? Recommend wireless terminals – Ask Me Why!

Many People Automatically - Reach for their credit card when making their purchases

Think About All The Reasons - It makes sense to use a credit card. Statistics show that people use them; for all of the same reasons you do (and more) this applies to your clients too!

QuickBooks Expert Specializing In Construction Bookkeeping Services

About The Author:

Sharie DeHart, QPA is the co-founder of Business Consulting And Accounting in Lynnwood Washington. She is the leading expert in managing outsourced construction bookkeeping and accounting services companies and cash management accounting for small construction companies across the USA. She encourages Contractors and Construction Company Owners to stay current on their tax obligations and offers insights on how to manage the remaining cash flow to operate and grow their construction company sales and profits so they can put more money in the bank. http://www.fasteasyaccounting.com/sharie-dehart/