02/07/2008
"The economic stimulus package will give me the opportunity to spend and invest in my business this year when I otherwise would not have been able to. Now I will be able to buy that additional truck and invest in new technology for my business. In this day in age, it is important my business has the technological resources required to stay competitive. In the long run, this package will make my business stronger." - Linda Brown, Globe Furniture
"The accelerated depreciation condition in the package will help my business increase its productivity levels by enabling me to buy new equipment." - James Hoon, Hoon Inc.
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Jim Barnard, Barnard Manufacturing |
"Our bottom line will benefit. This means that we can offer our employees additional bonus opportunities during the year that will make for happier and more productive employees." - Thalia Hutter, Hutter Racing Engines
"The stimulus plan gives us the confidence to expand our facilities immediately. With these tax incentives, our business can move forward quickly with plans to invest in new equipment and hire new workers." - Bob McCutcheon, McCutcheon Apple Products
President George W. Bush recently signed the Economic Stimulus Package for the American People Act of 2008 into law. During the debate in Congress, NFIB's federal lobbying team led the efforts to ensure that the package contained incentives designed to spur small business investment during what is expected to be a period of slowed economic growth. Given that small businesses are America's No. 1 job creators, NFIB's team was relentless in its efforts to make certain this package would help small business owners grow and expand their businesses.
Like many bills passed by Congress, the economic stimulus bill is full of complex and specialized language that can be difficult to understand. As a result, we have outlined in plain language below the two key provisions that small business owners should be fully aware and knowledgeable of moving forward:
- The economic stimulus package doubles the current small business expensing limit from $125,000 to $250,000. This provides small business owners with an immediate deduction for the entire cost of certain investments made in their business, such as purchasing new equipment. This applies only to small business owners who invest less than $800,000 in their business this year. NFIB has long supported immediate expensing as an incentive for owners to make investments in their businesses and hire new employees.
- The economic stimulus package also provides for a 50 percent bonus depreciation for certain investments in business. This means a business can take an immediate deduction of 50 percent of the investment, rather than deducting the value over a number of years. Unlike expensing, the bonus depreciation deduction would apply to investments that exceed the $800,000 limit.
The bottom line is that both of these provisions put money back in the hands of small business owners so they can grow their businesses this year. Please contact us if you have any questions about this legislation at kristina.blair@nfib.org.
Remember that NFIB continues to fight for small business interests in Washington, D.C., and in your state.
