With the section 179 accelerated depreciation tax rule, does it make sense to buy a $10K mower every year? Or several mowers if you are a big operator?
Say you buy a mower for $10K, reducing your taxable income by the full $10K by taking the full depreciation the first year, then theoretically sell it for $8K the next year. Do you pay capital gains on the $8K? Even so, would it be better to pay only 20% capital gains on $8K ($1600) instead of 30% income tax/soc security/medicare taxes on $10K ($3000)? Is that how it works? Do guys cheat and not report the $8K sale of the asset (mower)?
Or maybe you buy a truck every year for $35K, and sell the old one.
Is anyone doing this section 179 stuff?