5 Purchases Every Small Business Should Make Before Year End
Updated on November 6, 2023
Timing matters when spending your hard-earned money. End-of-year small business purchases present a rare opportunity to save money through tax benefits or year-end sales. The end of the year can be the best time to make some investments and there’s still time to get some savings in. Here are five end-of-year purchases that may benefit your small business bottom line.
Equipment is a great option for your end-of-year small business purchases. It’s easier to spend extra cash leftover in the budget rather than projecting if you have money to fund equipment investments.
The ability to take full advantage of Section 179 deductions is another reason to consider equipment when making end-of-year small business purchases. Section 179 is a tax law that allows businesses to deduct expenses on equipment, vehicles, and similar purchases. There are many nuanced rules on exactly how the deduction works. A part of Section 179 allows taxpayers to deduct up to $1.08 million in equipment costs. Additionally, business owners can claim a depreciation of up to 80% of the purchase price. In 2024, the Bonus Depreciation drops to 60% — so buying qualified items now can save you money and maximize value.
2. Major, Critical Expenses
Just about every small business owner has been there: There’s a major expense for something that’s key for the business, but the budget is straining to handle it. The end of the year allows you to handle purchase costs more easily and accurately predict how much business financing you really need.
Additionally, making larger purchases at the end of the year could also give you a larger tax deduction by reducing your taxable income for the year. Increasing your annual expenses before the year ends sets you up for greater returns in the next year.
3. Business Services, Including Tech Subscriptions
Signing up for business services, such as a new cloud app, can be a great option when it comes to end-of-year small business purchases. You can often deduct the startup fees and similar expenses for tax purposes. On top of that, many vendors will offer special deals near the end of the year as they work toward sales quotas and similar goals.
The cost of one year’s vehicle model often drops when the next year’s edition is set to hit the market. Auto dealers often offer great end-of-year deals as they try to clear inventory to make space for new models. You can use this opportunity to get a great price while also taking advantage of potential tax benefits.
Take advantage of the Section 179 Deduction
QuickBridge can help with vehicle financing.
5. Technology Hardware
End-of-year sales, including holiday-related deals, are common in the tech industry. From upgrading your computers to getting new phones, tech equipment is a natural fit for end-of-year small business purchases. Some tech can qualify for Section 179 deductions, and the kind of deals you can often get at the end of the year can lead to serious savings.
Using Financing to Support End-of-Year Small Business Purchases
Of course, you can only engage in end-of-year small business purchases if you have the cash on hand. Consult with your tax advisor to learn about your financing options that best suit your needs. Small, short-term financing from QuickBridge can help you get the capital you need quickly to create long-term value through strategic purchases that put you in a better position for next year while keeping costs under control.
This information is not tax advice. Please consult your tax advisor or a professional for more information.