House Tax Extender Bill Includes Multiple Breaks For Small Businesses

Date: December 17, 2015

Bill Permanently Extends Two Deductions, Suspends Insurance Premium Tax

Further details have emerged about the tax extender bill pending in the House, first agreed to during late-night negotiations on Monday. The Wall Street Journal reported that the House is poised to approve the measure, which includes more than $600 billion in tax cuts that will help various businesses and manufacturers as well as many others. The Journal briefly highlighted a number of the tax provisions. Among these is the permanent extension of Section 179, a provision that will allow small businesses to write off up to $500,000 in capital cost instead of limiting them to $25,000. In a nearly 5,000-word piece analyzing the impact of various provisions within the tax extender bill on government agencies and business, Science Magazine highlighted a provision that makes the research and development (R&D) tax credit permanent. The New York Times examined the tax deal, noting that businesses in various industries will benefit from the bill, from cider makers to medical device makers. Health insurers nabbed a victory in the $1 trillion spending bill unveiled late Tuesday night, earning a one-year freeze on the so-called premium tax. In another development affecting small businesses, The Hill reported that as part of the budget deal there will be a “one-year freeze on the so-called premium tax” known as HIT.

What This Means For Small Businesses

Small businesses are seeing some positive outcomes from the House tax extender bill. The Business Journals reported that the House move to permanently extend Section 179 “is easily the most positive thing Congress has done for small business in the past several years, and it will ripple through the economy in the form of new investments and more jobs,” according to NFIB CEO Dan Danner. While the Politico Influence tipsheet included NFIB and the Stop the HIT coalition among the winners in the budget rider battle, The Hill quoted Amanda Austin, NFIB Vice President of Public Policy, as saying the provision to delay HIT “isn’t ideal, but it’s certainly a positive step.” On the balance, there is still work to be done to ensure that small businesses have a more beneficial tax code.

Additional Reading

The AP, USA Today , and the Washington Times were among the additional outlets covering the tax extender bill.

Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.

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