On July 11, the House of Representatives took a step towards getting companies off the sidelines and back into the game of capital investment by approving legislation to permanently extend 50 percent bonus depreciation for new equipment purchases, 258-160.
The legislation (H.R. 4718), introduced by Rep. Pat Tiberi (R-Ohio), was endorsed by AED and a wide cross section of industry groups.
Since April, the Senate has been sitting on its own proposal addressing terminated tax “extenders.” The Expiring Provisions Improvement Reform & Efficiency (EXPIRE) Act (S. 2260) – which includes a two-year extension of 50 percent bonus depreciation and reinstatement of the higher Sec. 179 expensing levels. Given the political climate on Capitol Hill, the near-term future of any tax-related legislation is uncertain. Democrats continue to complain about both the price and also the lack of revenue offsets typically demanded by the GOP for other programs.
The most likely scenario is that Congress will pass an extenders tax package in the lame duck session after the 2014 elections.