By now you’re well aware of the basic components of the tax agreement recently codified into law. Of major importance to trucking are two facets that have gone largely unmentioned in the media.

First, the Section 179 deduction has been retroactively restored to $500,000 for 2012, and extended for 2013 (2012’s limit was previously $125,000). This means business can deduct up to a half million dollars’ worth of new and used equipment from their 2012 and 2013 tax liabilities (although the benefit decreases if more than $2M is spent).

Second, the 50% bonus depreciation has been renewed for 2013. This essentially means businesses can deduct half the cost of their new equipment in the first year (as opposed to spreading it out over time). This benefit is particularly attractive to businesses who spent or will spend more than $2M on equipment – not much of a stretch for a fleet replacing older trucks.

Both these components of the tax law encourage investment. With the tax portion of the fiscal cliff addressed, we are optimistic about used truck pricing in early 2013.