The new tax bill that took effect January 1, 2018. This includes significant changes that may be important to owners of commercial buildings. Spann Roofing wanted to highlight how the sweeping changes are relevant to roof replacement projects. Significant updates were made to the depreciation laws. The changes are summarized below:
The changes to Section 179 depreciation rules. 2018 is an excellent time to replace your roof. The tax reform bill is a roof replacement. Then the option is to reduce your tax liability during the year our roof was replaced.
Roof replacement now being considered a qualified real property improvement. 100% of the cost of the roof replacement can be expensed in the year the roof is installed. Listed below is an example of what the new Section 179 rules could mean for you:
|2017||2018 & Prior|
|Cost of New Roof||$400,000||$400,000|
|Expensed in Year Installed||$400,000||$26,667 |
(15-year depreciable life)
|Reduced Tax Liability||$120,000||$8,000|
*The tax rate above is used for illustrative purposes only. Every tax situation is different. Please consult your tax advisor.
***Please note that we did not include every detail of the new tax reform bill in this memo. Roofing-related changes were highlighted and simplified for educational purposes. Below is a link that goes into more detail. Please consult your tax advisor to determine the tax ramifications for your business.***
Tax Bill Impact on Individuals:
Tax Bill Impact on Businesses: