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The Resource Group

2 Tax Incentives to Enable Your 2011 ERP Project

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by Brian Hayes, The Resource Group

Is your company considering purchasing an ERP software solution like Microsoft Dynamics GP in 2011, but you do not have money in the budget for a software upgrade?  Here are 2 tax incentives created by the U.S. government to increase cash flow and encourage small business growth.

  1. Net Operating Loss Carryback: If your small company’s deductions exceed your income for 2010, you may qualify for a NOL Carryback. The Internal Revenue Service announced for the 2010 tax year that companies may carryback their Net Operating Loss two years to offset their 2010 Net Operating Loss against earned income in 2008 & 2009. You may need to contact your CPA to amend the prior year’s tax returns that are affected in the carryback. 
  2. Section 179: In addition to the NOL Carryback offered by the IRS, they also increased the amount of which companies may write-off  qualifying equipment for 2010 tax year to $500,000, up from $250,000 in 2009, for companies that purchased $2,000,000 or less in business equipment in 2010. Fortunately, one of the qualifying items for the deduction is “Off-the-Shelf” software. Essentially, if you purchased $500,000 in software in 2010 you would be eligible to write off the entire amount in that tax year. This tax benefit would accelerate the depreciation on equipment when liquidity is needed. You must purchase qualifying equipment before December 31, 2010 to qualify for the increased deduction.  Get more information on Section 179.


by Brian Hayes, The Resource Group – Seattle, Washington Microsoft Dynamics GP Partner

The Resource Group is a seasoned team of business professionals that help companies gain valuable business insight from their financial systems. If you are interested in learning how a Microsoft Dynamics GP software solution could benefit your company, contact The Resource Group.

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