A provision buried within the Administration's nearly $800 billion stimulus package will extend a piece of the earlier Administration's plan designed to aid small businesses that purchase new equipment including office furniture, business telephone systems, computer hardware and software, security systems, and refrigeration to name a few examples.

The 2009 American Recovery and Reinvestment Act (ARRA) has extended for one year Section 179 of the 2008 Economic Stimulus Act which allows business to 100% depreciate the cost of their equipment purchase in the first year for purchases up to $250,000. The ARRA also allows for 50% bonus depreciation on all purchases from $250,000 up to $800,000. Under the ARRA, the equipment must be new and must be purchased and placed in service in 2009.

How it works-
* Up to $250,000 of new equipment purchases can be 100% written off.
* your average savings ends up being about 35% of the invoice total.

Here's an example of how a $300,000 purchase breaks down...
Cost of Equipment Purchase: $300,000.00

Section 179 Write-Off Amount: $ 250,000.00
50% Bonus Depreciation: $ 25,000.00
Regular 1st Yr Depreciation: $ 5,000.00
Total First Year Deduction: $ 280,000.00
Cash Savings on Purchase: $ 98,000.00
(Assuming a 35% Tax Bracket) Lowered Cost of Equipment: $ 202,000.00

* The first $250,000 is fully depreciated in 2009. * The remaining $50,000 is 50% depreciated.

* The remaining $25,000 left over is depreciated on a normal MACRS schedule with first year depreciation being 20% ($5,000).
* This provides your with a total deduction of $280,000 of the $300,000 purchase.

* Assuming a 35% tax bracket, you would realize tax savings of $98,000 when you file your 2009 return. If your tax bracket is higher or lower, the tax savings would adjust proportionally.

Talk to you accountant with any questions.

WE CAN PROVIDE 100% of your needs for: VOICE- DATA- VIDEO

Don't forget all the other things we can do for you... IT/Data Hardware and support, Data Backup solutions, Internet and telephone lines, Video Surveillance Cameras, IP Solutions, Wireless, and more...

* this is not meant as financial advise please consult your accountant or financial advisor before making any capital purchase.

Thank you for your continued business and trusting Pilothouse Communications with your vital business communications. We are here to be your trusted technology partner for voice/data/video security.

Sincerely,