OK... It is true that as part of the "Stimulus" plan, the government did raise the amount of capital purchases that can be classified as "expenses" temporarily. But go look at the 2007 number... and before. That is the "normal" number. In my business, I am over the $125K number in capital items this year so anything over that, I literally would have to pay income tax on it. This year the limit is $500K... but those are the "tax expenditures" and "loopholes" that are going away because of the breaks for "millionaires and billionaires" that people are screaming about. My original numbers hold true minus the stimulus and unfair tax breaks us business owners get. If I spend $1M on capital items this year, I'll have to pay personal income tax on $500K of that if I paid for it from the cash flow of the business. Normally on $1M of capital/equipment purchases, I would have to pay personal income tax on $875K of the equipment I bought paid for by the cash flow of the business. This is on top of the property taxes, etc...