If your company expansion plans include more space for people or equipment, a Starrco modular building may offer you significant tax relief over conventional construction.
Conventional Construction is Real Property
Conventional construction is permanent and is classified as real property. It has a 39-year depreciable life.
Starrco Buildings Are Tangible Personal Property
Starrco products, on the other hand, can be fully dismantled, relocated and reassembled. This allows Starrco products to be classified as tangible personal property. They have a seven-year depreciable life.
Bonus Tax Relief for Tangible Personal Property
In 2016, Congress will allow you to depreciate up to $500,000 of tangible personal property in one year under Section 179 of the Internal Revenue Code.
This bonus depreciation is part of Congress’ efforts to stimulate the economy and encourage organizations to invest in capital goods.
“This is a significant tax benefit,” said Starrco Executive VP John Gilmore. “Assuming your capital expenditures are less than $500,000, Section 179 of the tax code allows you to fully depreciate a Starrco building the year you buy it. With conventional construction, that would take you 39 years.”
For example, if you spend $20,000 on a Starrco building this year, you could depreciate the entire $20,000 and have a potential tax saving of $6,800.
Tax Savings Calculator
Here is an easy to use Section 179 calculator that will help you calculate how much you can save.
|Building Type||Cost||First Year Tax Depreciation||Tax Rate||Year 1 Tax Savings|
|Starrco Modular Office||$20,000||$20,000||34%||$6,800|
It is always recommended you consult your tax advisor to assess your particular situation.