Last week, the U.S. House of Representatives voted to make a permanent tax provision that would allow small businesses to write off up to $500,000 in new equipment purchases and some improvements to real property instead of depreciating the costs over time. H.R. 4457, titled America’s Small Business Tax Relief Act of 2014, would provide small businesses with expensing levels that are permanent, predictable and at a level adequate to their needs.
This change to Section 179 of the federal tax code would prevent the expensing level to fall all the way to $25,000 in 2014, after being at $500,000 from 2010 through 2013. It also indexes the level to inflation. In addition, the House also passed a bill that eases the tax burden on small businesses that change from taxable C-corporate status to S-corporate status. Local businesses will have the ability to make purchases to benefit both themselves and customers as the H.R. 4457 expensing levels are more flexible and lenient.
On June 12, Arizona Democrats Ron Barber, Ann Kirkpatrick and Kyrsten Sinema joined Republicans Paul Gosar, Trent Franks, Matt Salmon and David Schweikert in supporting this pro-jobs legislation, which now goes to the U.S. Senate for its consideration. They accomplished what a similar bipartisan majority in the Arizona legislature did earlier this year: it loaded a badly needed shot in the arm for the small-business owners who generate a significant portion of new jobs in the nation.
Last week’s strong bipartisan House vote to pass H.R. 4457 is very encouraging to small business, especially as demonstrated by the votes of Arizona’s congressional delegation.
Farrell Quinlan is Arizona state director for the National Federation of Independent Business.
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