Congressional Committee Approves Permanent Bonus Depreciation & Charity Bills

Bloomberg BNA on proposed permanent extension of bonus depreciation:

The House Ways and Means Committee approved legislation to make bonus depreciation permanent, as well as a number of tax measures related to charitable giving.

The depreciation measure (H.R. 4718) advanced after a vote of 23-11, one in a series of party-line votes as Republicans and Democrats on the panel tussled over whether the forgone revenue from tax expenditures should be recovered elsewhere in the budget—a position House Democrats have staked in the drawn-out argument over a number of tax provision extensions.

If enacted, the depreciation measure would cement language originally conceived as temporary economic stimulus. A two-year extension has been approved by the Senate Finance Committee and is awaiting action on the Senate floor.

In essence, bonus depreciation allows companies to write off more than half the cost of some investments immediately. The tax foundation has put "pen-to-paper" and performed some analysis about the economic and budgetary effects of bonus depreciation.

This brief overview of some important considerations associated with the proposed tax legislation is by no means comprehensive. Always seek the advice of a competent professional when making important financial and legal decisions.

Steve Cook is an attorney at Cook & Cook. Although his office is located in Mesa, Arizona, he represents clients throughout the Phoenix, Arizona Metropolitan area including the following east valley cities: Scottsdale, Paradise Valley, Tempe, Chandler, & Gilbert.

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