Empowerment Zone Section 179 Deduction

Some businesses in Empowerment Zones (EZs) can deduct an extra $35,000 on top of the standard IRS Section 179 deduction. This deduction is for the cost of qualifying property.

To qualify, you must place the property into use in the year you bought it.

Standard IRS Section 179 Deduction:

• $1 million for most businesses.
• $1,035,000 for businesses in Empowerment Zones for qualified equipment.
• Reduced for property and equipment over $2,500,000 in value.

EZs were created by the Department of Housing and Urban Development (HUD). They help business growth in certain communities. New York City has two Empowerment Zones:

• Upper Manhattan
• South Bronx

You cannot claim this credit if you have claimed state tax credits for your equipment.