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NAED Issue Alert: House To Vote On Small Business Tax Relief Act

NAED Vice-President of Government Affairs Ed Orlet and NAED have joined 173 other organizations to support H.R. 636, which will increase the limits available for deduction of business expenses to $500,000, including equipment expenditures. You are encouraged to contact your representative to show your support for the bill.

CLICK HERE to tell
your member of Congress to support H.R. 636.

Dear Representatives Tiberi and Kind:

The undersigned organizations, representing millions of businesses from every state and from every industry sector, are writing in strong support of H.R. 636, the America’s Small Business Tax Relief Act of 2015. This vital legislation would restore the small business expensing—sometimes called Section 179 expensing—level to $500,000, including limited improvements to real property and permanently index the level to inflation.

Small business expensing allows business owners to immediately deduct the cost of a qualified investment in the year that it is purchased, rather than being forced to depreciate the cost of the investment over time. Since 2003, Congress has steadily increased the amount of investment that small businesses can expense from $25,000 to $500,000. Support for this expansion has been long-standing, bipartisan and widespread. Legislation expanding and/or extending small business expensing has been enacted nine times, across two Presidential Administrations and six Congresses, under both Democratic and Republican leadership. These higher expensing limits were temporary, however, and at the beginning of this year they again reverted to $25,000 and will remain there unless Congress acts.

While expensing provides important relief to small business owners, it is not a “tax cut” or a “tax loophole.” Small business expensing simply gives companies the ability to recover the cost of investing in their own businesses more quickly than if they use depreciation. Expensing does not lead to a loss of revenue to the government over the lifetime of an investment—it is not a matter of if revenue is collected, but when. Additionally, small business expensing is available to all small businesses that purchase less than a specified amount of equipment each year.

Small business expensing gives business owners the ability to maximize investment in their companies during years when they have positive cash flow. This provides an incentive for small business owners to reinvest in their businesses, which fuels expansion, growth and jobs. This is particularly important for small businesses because they are more sensitive than larger firms to problems related to cash flow and are more reliant on earnings to finance new investment.

Additionally, small business expensing simplifies record-keeping and paperwork. Under standard depreciation, small business owners must keep records of, and file tax paperwork associated with, eligible investments for up to 39 years. According to a 2007 Internal Revenue Service (IRS) study, each small business devotes, on average, about 240 hours complying with the tax code, and spends over $2,000 in tax compliance costs each year. An overwhelming share of the time burden is due to record-keeping. Furthermore, high tax compliance costs consistently rank as a top concern of small business owners, and act as a drag on investment, growth and innovation. Small business expensing, as the Joint Committee on Taxation (JCT) notes, reduces the compliance burden for many taxpayers, freeing up time and resources to better devote to their businesses.

The roller-coaster, ad-hoc changes in the level of small business expensing, which have often been enacted retroactively in recent years, has greatly contributed to uncertainty and prevented long-term planning. Making the higher small business expensing limits permanent and predictable would greatly reduce uncertainty and reduce the incidence of tax policy driving business decisions.

Passage of legislation permanently maintaining small business expensing at $500,000 will increase investment and jobs, reduce complexity and paperwork and alleviate uncertainty. These are critical issues for small businesses, which continue to experience significant economic challenges. We thank you for introducing H.R. 636, the America’s Small Business Tax Relief Act of 2015 and urge all Members of Congress to support this important legislation.

Sincerely,

60 Plus Association

Academy of General Dentistry

Advanced Medical Technology 

Association’s Emerging Growth Company Council

Aeronautical Repair Station Association

Agricultural Retailers Association

Air Conditioning Contractors of America

American Apparel & Footwear Association

American Association of Small Property Owners

American Composites Manufacturers Association

American Council of Engineering Companies

American Dental Association

American Farm Bureau Federation

American Foundry Society

American Loggers Council

American Moving & Storage Association

American Rental Association

American Road & Transportation Builders Association

American Sheep Industry Association

American Society of Travel Agents

American Subcontractors Association, Inc.

American Sugarbeet Growers Association

American Supply Association

American Truck Dealers

American Veterinary Medical Association

Americans for Tax Reform

AMT – The Association For Manufacturing Technology

Arizona Small Business Association

Associated Builders and Contractors

Associated Builders and Contractors – Greater Tennessee Chapter

Associated Builders and Contractors Florida East Coast Chapter

Associated Builders and Contractors, Rocky Mountain Chapter

Associated Equipment Distributors

Associated General Contractors

Associated Oregon Loggers, Inc.

Association of Equipment Manufacturers

Association of Pool & Spa Professionals

Association of the Wall and Ceiling Industry

Auto Care Association

Automotive Parts Remanufacturers Association (APRA)

Aviation Suppliers Association

California Farm Bureau Federation

Carolinas Food Industry Council

CCIM Institute

Chamber of Commerce Southern New Jersey

Clean Water Construction Coalition

Colorado Wyoming Petroleum Marketers Association

Construction Industry Round Table

Cotton Warehouse Association of America

Delaware Retail Council

Delaware State Chamber of Commerce

Equipment Leasing and Finance Association (ELFA)

Equipment Marketing & Distribution Association (EMDA)

Foodservice Equipment Distributors Association

Great Lakes Timber Professionals Association

Hearth, Patio & Barbecue Association

Heating, Air-Conditioning and Refrigeration Distributors International (HARDI)

Idaho Dairymen’s Association

Image Apparel Institute

Independent Electrical Contractors

Indiana Chamber of Commerce

Indiana Manufacturers Association

Industrial Supply Association

Inland Pacific Chapter Associated Builders & Contractors

Institute of Real Estate Management

International Association of Plastics Distribution (IAPD)

International Cemetery, Cremation and Funeral Association

International Council of Shopping Centers

International Dairy Foods Association

International Foodservice Distributors Association

International Franchise Association

International Warehouse Logistics Association

Irrigation Association

ISSA—The Worldwide Cleaning Industry Association

Louisiana Logging Council

Maine Potato Board

Metals Service Center Institute

Michigan Association of Timbermen

Michigan Grocers Association

Missouri Forest Products Association

Modification and Replacement Parts Association

Montana Equipment Dealers Association

Montana Restaurant Association

Montana Retail Association

Montana Tire Dealers Association

NAHAD – The Association for Hose & Accessories Distribution

National All-Jersey

National Apartment Association

National Association of Chemical Distributors

National Association of Convenience Stores

National Association of Electrical Distributors

National Association of Home Builders

National Association of Manufacturers

National Association of REALTORS

National Association of Shell Marketers

National Association of Sporting Goods Wholesalers

National Association of Wheat Growers

National Association of Wholesaler-Distributors

National Automobile Dealers Association

National Barley Growers Association

National Beer Wholesalers Association (NBWA)

National Cattlemen’s Beef Association

National Confectioners Association

National Corn Growers Association

National Cotton Council

National Council of Chain Restaurants

National Council of Farmer Cooperatives

National Electrical Manufacturers Representatives Association

National Fastener Distributors Association

National Federation of Independent Business

National Funeral Directors Association

National Golf Course Owners Association

National Grocers Association

National Lumber and Building Material Dealers Association

National Marine Distributors Association

National Milk Producers Federation

National Multifamily Housing Council

National Pork Producers Council

National Potato Council

National Propane Gas Association

National Restaurant Association

National Retail Federation

National Roofing Contractors Association

National Small Business Association

National Sorghum Producers

National Stone, Sand and Gravel Association

National Sunflower Association

National Tooling and Machining Association

National Utility Contractors Association (NUCA)

NATSO, Representing America’s Truckstops and Travel Plazas

New Jersey Business & Industry Association

Non-Ferrous Founders’ Society

North American Die Casting Association

North Carolina Retail Merchants Association

North Country Chamber of Commerce

North-American Association of Uniform Manufacturers & Distributors

Northern Arizona Loggers Association

Northern Plains Potato Growers Association

NPES The Association for Suppliers of Printing, Publishing and Converting Technologies

Pet Industry Distributors Association

Petroleum Marketers & Convenience Stores of Iowa

PMCI Trust

Precision Machined Products Association

Precision Metalforming Association

RINAlliance, Inc.

Small Business & Entrepreneurship Council

Small Business Legislative Counsel

Society of American Florists

South Carolina Retail Association

South East Dairy Farmers Association

Southeast Milk, Inc.

Specialty Equipment Market Association

SPI: The Plastics Industry Trade Association

Tennessee Hospitality & Tourism Association

Textile Care Allied Trades Association

The Outdoor Power Equipment and Engine Service Association (OPEESA)

Tire Industry Association

Truck Renting and Leasing Association

U.S. Canola Association

U.S. Chamber of Commerce

United Egg Producers

United Producers, Inc.

US Dry Bean Council

USA Dry Pea & Lentil Council

USA Rice Federation

Utility & Transportation Contractors Association of New Jersey

Washington State Potato Commission

Western Equipment Dealers Association

Western Growers Association

Western United Dairymen

Wichita Independent Business Association

Wisconsin Grocers Association

Wisconsin Manufacturers & Commerce

Wisconsin Restaurant Association

Woodworking Machinery Industry Association

 

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