Monday, June 23, 2014

House passes small business expensing measure

Washington-The House last week approved a bill (H.R. 4457) to permanently extend the increased section 179 small business expensing limitations, which expired at the end of last year. For 2013, the maximum Section 179 deduction was appropriately set at $500,000 of purchased property reduced dollar for dollar when investments exceeded $2 million. 

The current maximum deduction is $25,000.

In a letter to House Ways and Means Committee members before they voted on the Section 179 bill, American Farm Bureau Federation President Bob Stallman explained that Farm Bureau puts a priority on tax code provisions that give farm and ranch businesses the ability to deduct expenses immediately instead of having to depreciate them over time so that they can improve cash flow and better match income and expenses.  

He also noted how Congress' practice of extending important small business tax provisions for one or two years at a time make its very difficult for farmers and ranchers to plan and adds immense confusion and complexity. Long-standing tax provisions, such as Section 179 small business expensing, should be made permanent at the 2013 level, he said. 

Like their House counterparts, Senate Finance Committee members have also been working on tax extenders, although they've bundled them into one bill, Expiring Provisions Improvement Reform and Efficiency (EXPIRE) Act (S. 2660). That bill, which extends all the expired provisions for two years, including Section 179 small business expensing, has yet to hit the Senate floor because of a partisan disagreement about the amendment process.

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