By SEMA Washington, D.C., Staff
The U.S. House Ways and Means Committee passed a bill to permanently set the Section 179 deduction at $500,000. The House is expected to pass America's Small Business Tax Relief Act of 2015 in the coming days. The legislation will then be referred to the U.S. Senate’s Finance Committee, which is currently pursuing comprehensive tax reform.
The House bill permits small businesses to write off 100% of their capital investments, up to $500,000, in the year the purchase was made. Because Congress only extended this provision retroactively for tax year 2014, companies are currently limited to expensing purchases up to $25,000 in 2015 and future years. The legislation also increases the number of companies eligible to take the full write off by increasing the amount a business can invest in equipment from $200,000 to $2 million. The $500,000/$2 million deduction caps would also be tied to the rate of inflation starting in 2016.
The legislation would remove small-business uncertainties about tax deductions when making long-term investments. SEMA has joined with more than 150 other groups representing various small-business interests to support this legislation.
For more information, contact Eric Snyder at erics@sema.org.