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Bill Would Provide Stability For Small Employers Encouraging Growth

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Washington, February 2, 2015 | comments

U.S. Congressmen Pat Tiberi (R-OH) and Ron Kind (D-WI) today reintroduced America’s Small Business Tax Relief Act. The bill, first introduced during the last Congress, would help create stability for small businesses leading to their growth and expansion by making permanent increased small business expensing outlined in Section 179 of the tax code.

“It’s been proven that members of both parties can unite around this issue and pass this critical legislation,” said Congressman Tiberi. “It would provide predictability for small business owners by making permanent a small business expensing measure that’s been part of the tax code since the 1950s. Employers have told me over and over that this measure reduces compliance costs for small businesses, reduces the cost of capital, and improves cash flow allowing them to invest, expand, and create jobs.”

“Employers in Wisconsin and across America need stability and predictability in their tax planning so they can make important budget and purchasing decisions,” said Rep. Kind. “This bipartisan legislation will help small businesses, family farms, and other employers by removing uncertainty in the tax code, so they can expand their operations and hire new workers.”

From 2010-2013, the expensing rules outlined in Section 179 of the tax code allowed small business owners, farmers, and ranchers to immediately deduct up to $500,000 in investments in property, equipment, and computer software rather than depreciating such costs over time. Late last year, Congress passed and the president signed into law a measure to retroactively extend these levels for 2014. However, over the years, the deduction limit has varied; this year it dropped to $25,000 of qualifying property.

The Tiberi-Kind bill would make permanent the levels effective during the 2010-2014 tax years allowing taxpayers to expense up to $500,000 in investments in property, equipment, and computer software with the deduction phased out after investments exceed $2 million. These amounts would be adjusted for inflation.

In 2014, the Tiberi-Kind bill to make the $500,000 level permanent passed the U.S. House, by a vote of 272-144 as a stand-alone measure, and it passed as part of HR. 4., the Jobs For America Act, by a vote of 253-163. Neither bill was considered by the Senate.

Support for making increased small business expensing permanent has been longstanding and widespread. Organizations like the National Federation of Independent Business, the Farm Bureau, the Associated Builders and Contractors, and the U.S. Chamber of Commerce support this bill.
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