WASHINGTON--- Today the Senate passed an expanded economic stimulus package that includes a small business tax provision championed by Senators John Kerry (D-Mass.) and Olympia J. Snowe (R- Maine). Senators Kerry and Snowe hailed the passage of this legislation, which will provide enhanced expensing for businesses buying equipment and placing it into service this year.
“Providing small business owners with immediate tax relief gives them an incentive to invest and help jumpstart the economy,” said Senator Kerry, Chairman of the Committee on Small Business and Entrepreneurship. “Small businesses account for almost half of our economy and create almost two-thirds of all new jobs, so this targeted tax incentive is a wise investment in our country’s economic stability.”
Senator Snowe, the Ranking Member of the Senate Committee on Small Business and Entrepreneurship, said, “I aggressively fought to include provisions that would support the true job creators of our economy – small businesses. Taking these steps will help small businesses free-up additional capital to create new jobs. Investing in our nation’s small businesses is a direct and responsible step we can take to reverse the current economic downturn that is creating numerous hardships for employers and workers throughout the country.”
Specifically, this tax provision will allow small businesses to elect to expense the cost of qualified assets they purchase in 2008, within certain limits in lieu of depreciation. The proposal increases the expensing limit from $125,000 to $250,000 for firms with a threshold of up to $800,000.