Connecticut Small Business Cheers Permanent Tax Extender
HARTFORD (December 16, 2015) – Small businesses will no longer have to wait until the last minute
every year to determine the tax consequences of investing in new equipment,
technology or capital upgrades under a bipartisan deal unveiled late Tuesday
night, and according to the National Federation of Independent Business
(NFIB) the result is likely to be more jobs and a stronger economy
nationwide.
“Creating a positive growth environment in Connecticut
has been a constant struggle that has left small business owners with little
optimism. Today, for the first time in recent memory, Congress is considering a
measure that will would encourage new investments and aid with job creation,”
according to Andrew Markowski NFIB Connecticut state director. “State lawmakers
managed to do almost nothing to help the small business community in Connecticut
this year, at least Capitol Hill is attempting to create a level of economic
stability that has been sorely lacking.”
NFIB has pushed for several years to make
section 179 of the IRS Tax Code permanent. Under that provision, businesses
can expense up to $500,000 of new investment in heavy machinery, office
equipment, computer technology or many other big-ticket items that they
need. Small business expensing has been a feature of the tax code for
decades as a way to encourage investment and growth. When the Bush tax
cuts expired, however, the amount that small firms can expense dropped down to
$25,000 and expires every year unless Congress extends it.
“Congress waiting until the last minute to
extend this provision has created accounting chaos for small business owners
and directly resulted in our members holding off on making investments into
their businesses due to the uncertainty. The fact that it will now be permanent
is a welcome change from the past,” explained Markowski.
With a bipartisan deal to make expensing
permanent now likely to pass through Congress, small businesses will be finally
able to plan out their investments. The tax package, which is expected to
receive action tomorrow, will be a key vote for NFIB in the House and Senate.
“The tax benefit encourages businesses to make
big investments and the permanency creates predictability, something Connecticut
small businesses have been yearning for,” said Markowski. “Our research
predicts that nationally we’ll see hundreds of thousands of new jobs as a
result but it remains to be seen if this will be enough to help our state begin
to climb out of the hole we find ourselves in.”
