"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 and 2009. These tax cuts are critical for helping our job creators, and my bill will continue to give small businesses added incentive to expand and create jobs even as our economy struggles to recover. I am urging my colleagues and the administration to extend this provision as part of any additional economic recovery measure."
Specifically, the Small Business Expansion and Job Creation Act amends Section 179 of the Internal Revenue Code (IRC) of 1986. Under current law, small businesses are allowed to deduct up to $125,000 for certain capital expenses in a given year. Section 179 was amended over the last two years to allow for deductions of up to $250,000 for capital expenses that occurred in those years.
Congressman Bright's proposed bill will set the 2010 rates and the same levels as 2008 and 2009. Additionally, the Small Business Expansion and Job Creation Act would extend a one-time 50% bonus depreciation rate for total yearly purchases that exceed $250,000. Without action, these taxes will revert back to the 2007 levels.
"Small businesses are the backbone of America and they will be the engine that jump starts the economy," Bright said. "This tax break is has been proven successful and must be extended in 2010."