Congressman Bobby Bright recently introduced legislation that would extend small business tax deductions for capital expenses. Specifically, H.R. 361 allows businesses to deduct a greater amount of certain capital expenses in 2009 and also provides an additional bonus depreciation in the first year those expenses occur. This is the first bill that Congressman Bright has sponsored. Additionally, Bright is the first freshman Democratic member in the 111th Congress to introduce legislation.
“Our small businesses are suffering in this economic climate and they need all the help they can get,” Congressman Bright said. “This is a common sense bill that will extend tax breaks that small businesses received in 2008. H.R. 361 will give small businesses added incentive to expand and create jobs even as our economy is in a recession. I am urging my colleagues and the administration to include this provision as part of any economic recovery measure.”
Specifically, H.R. 361 amends Section 179 of the Internal Revenue Code (IRC) of 1986. Under current law, Section 179 allows businesses to deduct up to $125,000 for certain capital expenses in a given year. Section 179 was amended in the last Congress to allow for deductions of up to $250,000 for capital expenses that occurred in tax year 2008. H.R. 361 extends the 2008 changes into 2009. Additionally, H.R. 361 would extend a one-time 50% bonus depreciation rate for total yearly purchases that exceed $250,000.
“Small businesses are the backbone of America and they will be the engine that jump starts our struggling economy,” Bright said. “This bill is a step in the right direction towards helping our small businesses expand and create jobs.”