Senate bill would boost business with tax break on equipment, property

July 16, 2015 By    

Sen. Pat Roberts, R-Kan., introduced legislation to amend the U.S. tax code and make permanent a 50 percent depreciation bonus on new equipment and property purchases. The tax break previously expired.

According to a press release from Roberts’ office, the bill would allow businesses to deduct half the cost of new purchases immediately. The idea behind the legislation is to free up money for reinvestment and help businesspeople like propane retailers grow.

“This legislation will provide much-needed certainty in the tax code so businesses can better plan investments that create more jobs and growth in our communities,” Roberts says of his bill, S. 1660. “Bonus depreciation has been extended and expired many times, and it is time we make this permanent to give businesses more predictability in an already overly complex tax code.”

Bonus depreciation was first enacted in 2002, but its benefits to the business community haven’t remained consistent, according to Roberts. More generous depreciation deductions reduce the after-tax cost of investing, encouraging higher levels of investment spending by businesses.

According to the press release, the legislation allows businesses to claim unused Corporate Alternative Minimum Tax Credits and use them for capital investment.

The National Propane Gas Association recently sent a letter of support to Roberts for S. 1660, as well as one to Rep. Pat Tiberi, R-Ohio, who introduced a bill in H.R. 2510 that would also extend bonus depreciation and make it permanent.

“S. 1660 would help our member companies have better access to capital, invest in new facilities and create American jobs by permanently extending 50 percent bonus depreciation – i.e., allowing businesses to deduct immediately, or ‘expense,’ half of the cost of new equipment purchases,” writes Rick Roldan, NPGA’s president and CEO, in a letter to Roberts.

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About the Author:

Kevin Yanik was a senior editor at LP Gas Magazine.

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