federal Tax

Tax Relief for Moving Company Fleets

Tax Relief for Moving Company Fleets

If you manage fleets for small or medium-sized businesses, you know that taxes can take a toll on your margins. Fortunately, Congress recently passed the “American Taxpayer Relief Act of 2012”, a new law that provides tax relief in several different ways. The changes include extensions to multiple tax credits that affect fleets as well as credits for the purchase of alternative-fuel vehicles and infrastructure.

Section 179 Deduction Revision

Originally, 179 of the US tax code allowed businesses to deduct the cost of certain new and used property. These included capital equipment and certain software installed within the tax year. The deduction limit for these assets was $125,000. However, the new law revises this in the efforts to phase out dollar-for-dollar after $2 million is spent by a business. The maximum deduction was extended to $500,000 for those companies that own less than $2 million in qualifying capital expenditures for the 2012 and 2013 tax years. Vehicles that qualify for this deduction are:

  • Heavy non-SUV vehicles with at least 6 feet in interior length
  • Vehicles such as shuttle vans that can seat nine or more passengers
  • Vehicles with fully-enclosed driver’s compartment and cargo area and no seating behind the driver’s seat

However, limits such as total depreciation deduction limitation of $11,060 for passenger vehicles and $11,160 for trucks still apply.

Extension: Bonus Depreciation

This new provision allows small businesses to deduct the cost of new equipment purchased within the tax year. Companies that qualify to carry-forward Bonus Depreciation to a future year include businesses with a net loss in 2013. Other tax credits include R&D tax credits that had expired in 2011 that is retroactive for the 2012 and 2013 tax years.

Alternative-Fuel Tax Credit Extensions

One final way the 2012 Taxpayer Relief Act also gives qualifying businesses a one-year extension to several tax credits revolving around liquefied natural gas (LNG), compressed natural gas (CNG) and other alternative fuels. If you use these alternative fuels, you qualify for a 5o-cent per gallon greenhouse gas (GGE) alternative-fuel tax credit. Other extensions include the income tax credit for biodiesel and renewable diesel and two or three-wheeled plug-in electric vehicles.

If you are a manager of a small or medium-sized business, you potentially qualify for several types of tax relief revisions. Take advantage of the American Taxpayer Relief Act of 2012. Talk to your tax adviser today and discuss these and other tax credits. you know that taxes can take a toll on your margins.