Trendway Talks Tax Law: Good News for the Workplace Interiors Industry
Tax Cuts and Jobs Act of 2017
How Recent Changes in the Federal Depreciation Schedules Affect FF&E Purchases for 2018.
By: Jack Chance / CFO
At Trendway, customers are always top-of-mind for us. Whether its product engineering and design, operational excellence or sales and support, we are always thinking of how we can help make our customers businesses better with our products and information sharing. To that end, I want to share with you a significant change in the Federal tax regulations that should be shared with customers, our dealer partners and other workplace influencers.
Recent changes in the Federal Tax Depreciation Schedules will positively affect a customer considering a purchase of furniture or architectural products for 2018.
Under the current laws, a capital expenditure can be depreciated at a new accelerated rate of 100% in the first year after invoice.What that means to a customer is that they can reduce their gross tax liability through depreciation within the first (12) months of installation.
A business planning a furniture or architectural wall purchase can decide to deduct the full amount of its furniture and wall purchase expense in the first year of use from its gross taxable liability rather than waiting the (7) years necessary to realize full depreciation from past tax schedules.
Since architectural products depreciate as furniture, this is another significant advantage over stud and drywall, which is still depreciated over (39) years for Federal tax deduction purposes.
The following table demonstrates how the current accelerated depreciation schedule positively affects a purchase using the example of a $100,000 expenditure.
We are not providing tax advice.
This is only our interpretation of the recent changes in the United States business tax law depreciation schedules named in The Tax Cuts and Jobs Act of 2017 and how they may affect FF&E depreciations.
Please consult your accounting professional for specific advice for your businesses financial circumstances.