Entrepreneurs / Small Business  May 20, 2015

Sen. Bennet introduces ‘Small Business Expensing Act’ to help spur growth

Colorado Sen. Michael Bennet on Wednesday introduced a bill into Congress that would permanently increase the amount of costs for capital equipment that small businesses are allowed to write off in a given year.

Under Section 179 of the tax code, small businesses are now able to expense up to $25,000 in capital equipment costs in the year new equipment is placed into service rather than depreciating it over time.

Bennet’s Small Business Expensing Act would permanently increase that limit to $1 million. In past years, including 2014, the limit has been temporarily expanded by Congress to $500,000 through tax extender packages. The House of Representatives in February passed a similar bill to make the $500,000 limit permanent.

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By permanently increasing the limit, the aim is to provide small businesses with an incentive to continue to invest in their growth, as well as to provide them with more predictability as it relates to the cap.

“Colorado’s small businesses make up almost 98 percent of employers in the state and employ about half of the state’s private workforce,” Bennet said in a prepared statement. “This bill is one step we can take to ensure our tax code will protect their ability to create jobs and spur the economy.”

The next step for the bill would be to go to the Senate finance committee for a hearing, though no date for that has been set.

Bennet passed the expanded limit as an amendment to the Senate’s non-binding budget in March, instructing Congress to make such an update to the tax code – an indication, the Bennet camp hopes, of support for the bill itself.

Colorado Sen. Michael Bennet on Wednesday introduced a bill into Congress that would permanently increase the amount of costs for capital equipment that small businesses are allowed to write off in a given year.

Under Section 179 of the tax code, small businesses are now able to expense up to $25,000 in capital equipment costs in the year new equipment is placed into service rather than depreciating it over time.

Bennet’s Small Business Expensing Act would permanently increase that limit to $1 million. In past years, including 2014, the limit has been temporarily expanded by Congress to $500,000 through tax extender packages.…

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