The Honorable Wally Herger
2268 Rayburn House Office Building
Washington, DC 20515
Dear Congressman Herger:
The National Federation of Independent Business, the nation's leading small-business advocacy group, strongly supports the Small Business Expensing Expansion and Permanency Act of 2007. This legislation will stimulate the economy, allowing businesses to use more of their money immediately to grow their businesses and create new jobs.
Current law limits expensing to $112,000 this year and imposes an investment limit of $450,000 annually. Many small businesses exceed this expensing limit before the end of the year, and their inability to deduct more in that first year inhibits their growth. We are pleased to see that your legislation increases the expensing limit to $200,000, increases the investment limit to $800,000 and adjusts these limits for inflation. These changes will not only reduce the cost of capital for small-business owners, but they will also eliminate depreciation record-keeping requirements.
Small businesses are the job engines of America, creating roughly two-thirds of net new jobs in the United States since 1970. Allowing small-business owners to immediately expense investments has been a critical component of our economic expansion. The Joint Committee on Taxation has stated "making the increase in the expensing amounts permanent … reduces uncertainty with respect to the tax treatment of future investment, thus permitting taxpayers to plan capital expenditures with greater focus." Further, the Small Business Administration Office of Advocacy has stated that Section 179 expensing significantly benefits small businesses by creating a more level playing field.
Again, thank you for introducing the Small Business Expensing Expansion and Permanency Act of 2007. We look forward to working with you to enact this important legislation into law.
Sincerely,
Dan Danner
Executive Vice President
Public Policy and Political
