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Wide US Coalition Insists On Tax Extender Renewal

by Mike Godfrey, Tax-News.com, Washington

20 November 2014


More than 500 United States organizations, representing a wide range of individuals, businesses, and non-profit organizations, delivered a letter on November 18 to the House of Representatives urging lawmakers to work together during the current congressional lame-duck session to deal with the "tax extenders" package.

The more than 50 provisions that expired at the end of 2013 include mortgage tax relief; the deduction for state and local sales taxes; and education tax deductions, for individuals. And for businesses, they include increased expensing under Section 179; 50 percent bonus depreciation; the work opportunity tax credit; the credit for research and development (R&D) expenses; and tax breaks promoting renewable energy.

"These tax provisions are critically important to US jobs and the broader economy," the organizations wrote. "Failure to extend these provisions is a tax increase. It will inject instability and uncertainty into the economy and weaken confidence in the employment marketplace."

"The expired provisions should be renewed as soon as possible this year to enable implementation in time for the normal tax filing season. A delay in the tax filing season will delay tax refund checks and spending decisions, resulting in an immediate negative impact on the economy."

The organizations concluded by urging "all members of Congress to work together to extend, enhance, or make permanent these important tax provisions this year to provide a necessary bridge to comprehensive tax reform."

During a press conference call, National Association of Manufacturers Vice President of Tax and Domestic Economic Policy Dorothy Coleman confirmed that "renewing the tax extenders will provide a bridge of certainty and predictability for manufacturers until Congress can act on comprehensive tax reform. The R&D credit, investment incentives for manufacturers of all sizes, and provisions that affect US global companies are all key to helping manufacturers innovate, compete in a global marketplace, and contribute to US economic growth and job creation."

On the same date, a number of agricultural groups also sent a letter to leading tax policymakers in both the House and Senate urging them to act on the tax extenders before the end of the year.

The National Cattlemen's Beef Association's President, Bob McCan, noted that "this is a vital issue not just for agriculture, but for all businesses. Producers rely on a stable and predictable tax code in order to plan purchases, make investments and grow their business. We are already at the eleventh hour for tax planning, and it is incredibly important that Congress pass these extenders as quickly as possible."

Specifically, the letter asked Congress to focus on Section 179 small business expensing and bonus depreciation. These provisions allow businesses to maximize investments in years where they have positive cash flow, by taking a greater depreciation amount upfront rather than follow the standard schedule. Set at USD500,000 in 2013, the maximum amount a small business can currently deduct under Section 179 has returned to USD25,000.

"Agriculture relies heavily on large investments in machinery, equipment and other depreciable assets," McCan said. "And these tax provisions encourage cattlemen and women to make purchases and invest in expansion of their business, in turn investing in the expansion of rural America."

TAGS: individuals | tax | small business | business | sales tax | law | tax credits | legislation | United States | tax breaks | tax reform | research and development | Tax

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