Rep. Dave Camp (R-Mich.) recently lauded legislation that was passed by the House of Representatives to bring tax code certainty to small business owners, farmers and ranchers.
America’s Small Business Tax Relief Act, which was introduced by Rep. Pat Tiberi (R-Ohio) would make small business expensing outlined under section 179 of the tax code permanent. The bill would set clear expensing levels.
“Section 179 is a bipartisan provision that has been in place since the 1950s,” Camp, the chairman of the House Ways and Means Committee, said. “But businesses, farmers and ranchers cannot reap the full benefits when they have no idea if the provision is going to be around the next year, or what it may look like. This hurts their ability to plan for the future and expand their business.”
Under section 179, small business owners can immediately deduct investments in new equipment, property or computer software rather than depreciating costs over time. America’s Small Business Tax Relief Act would make the provision permanent and allow up to $500,000 of investments in new equipment and property to be immediately deducted, with the deduction being phased out if an investment exceeds $2 million.
The measure would also repeal a $250,000 limit on real property expensing and institute adjustments for inflation.
“By supporting permanent policies, Washington can promote certainty for American businesses and generate additional economic growth,” Camp said. “We have become too accustomed to poor jobs reports, anemic growth and just accepting the status quo. Small business expensing has been a bipartisan policy for decades, and it’s time to make it a permanent part of the tax code. Washington needs to wake up, start listening to the American people and act on real policies that strengthen the economy and help hardworking taxpayers. (This) legislation will do just that.”
The Farm Bureau recently said uncertainty under section 179 adds “immense confusion and complexity” to the tax code and makes it difficult for famers and ranchers to plan their year-to-year investments.