Kratovil Introduces Legislation to Cut Taxes On Small Businesses Owners Seeking to Reinvest in Their Companies
Small Business Property Reimbursement Act extends $250K tax deduction for small businesses through 2010 to help spur economy and create jobs.
Washington, DC – Today, Rep. Frank Kratovil introduced HR 3898, the Small Business Property Reimbursement Act. The legislation will extend a key tax deduction for small business owners that invest in new equipment for their businesses. Specifically, Kratovil’s bill will extend a provision of the tax code that allows small businesses to expense up to $250,000 of the total cost of qualified assets purchased for business purposes. If Kratovil’s extension does not pass, this deduction will decrease to $125,000 at the end of this year.
Rep. Kratovil’s bill would extend an enhanced Sec. 179 of the Internal Revenue Code through 2010 representing a significant tax subsidy for business investment. “Instead of bailing out giant corporations, we ought to focus on strengthening the small businesses that support our local economies and drive economic growth,” said Rep. Kratovil. “My bill provides much needed tax relief that will allow small business owners to re-invest and create new jobs.”
The higher expensing allowance is designed to increase business investment by augmenting the cash flow of firms that rely heavily on retained earnings to finance their investments. Expensing can increase a firm’s cash flow in the short run because it allows the firm to deduct the full cost of qualified assets in the tax year the firm places them into service. The legislation also serves to simplify the tax code by allowing an immediate deduction, instead of depreciation deductions over a specified recovery period.
Click here to read the bill.Kratovil’s bill has drawn praise from a number of small business advocacy organizations, including the National Association of Manufacturers (NAM) and the National Federation of Independent Businesses (NFIB). “The expanded expensing provision helps smaller manufacturers by lowering the after-tax cost of investing in new equipment and generating new orders from customers,” according to Dorothy Coleman, NAM Vice President of Tax and Domestic Economic Policy. “Extending this incentive through 2010 will enhance the effectiveness of the provision to spur desperately needed business investment and job creation.”
“We appreciate Representative Kratovil's efforts in introducing HR 3898. This legislation will provide small businesses with incentives and certainty to make new investments in their business. This is especially important in the current economic environment where small business hiring, capital spending and earnings are at record lows," said Brad Close, NFIB Vice President for Federal Public Policy. “If Congress wants to encourage small business owners to start investing in capital spending, then it is critical that they extend section 179 expensing limits. HR 3898 provides the kinds of tools and incentives that small businesses need to expand and grow their businesses. Small businesses are the engine of our economy, generating seven out of ten new jobs and leading our economy out of past recessions. The NFIB thanks Representative Kratovil for standing up for small business owners, our nation's job creators," said Close.
HR 3898 is the second small business tax incentive bill introduced by Kratovil since taking office in January. Earlier this year, he joined with Rep. Chris Lee (R-NY) to introduce H.R. 1552,
the Small Business Formation and Job Creation Act, which would increase the maximum deduction for business start-up expenses to promote the creation of new start-up small businesses.
Kratovil has also voted in favor of the Small Business Research and Innovation Act, legislation designed to create new jobs and boost the economy by supporting small business innovation in research and technology.
Rep. Kratovil offered an amendment to the legislation that raises the award ceilings for veteran-owned small businesses and creates new incentives for the formation of technology-based companies to compete for defense and homeland security related contracts awards, allowing veterans to capitalize on their service experience.
Rep. Kratovil Backs Coast Guard Reauthorization With Stronger Penalties for Illegal ImmigrationKratovil amendment to assess Coast Guard facility shortcomings passes unanimously; Maryland’s Oxford station is housed in temporary trailer and lacks a pier
Washington, DC – Today, Rep. Frank Kratovil joined a bi-partisan majority in backing HR 3619, the Coast Guard Reauthorization Act. This bill authorizes $10 billion for the Coast Guard in FY 2010 and provides for a 1,500 person increase in Coast Guard personnel, for a total of 47,000.
Kratovil lauded the bill for incorporating the provisions of H.R. 1029, Alien Smuggling and Terrorism Prevention Act, which the House passed by voice vote on March 31, 2009. These provisions ensure that the United States takes a comprehensive approach to combating smuggling both on land and at sea by authorizing punishment for persons who bring, recruit, encourage, transport or harbor an illegal alien knowing or in reckless disregard of the fact that the individual is without authority to enter the United States. The bill gives law enforcement stronger tools and also significantly enhances federal penalties for alien smuggling – raising it to a felony from a misdemeanor.
HR 3619 also requires the Department of Homeland Security to cross-check smugglers and illegal immigrants who are apprehended with terrorist watch lists to ensure that potential terrorist threats are stopped right at the border.
“Coastal and shoreline security goes hand in hand with putting a stop the illegal immigration that is draining our national resources,” said Rep. Kratovil. “This is a good bill that will give the Coast Guard the tools that they need to be an effective component of our national security while increasing the penalties for illegal immigrants as well as those who seek to bring them within our borders for personal profit.”
Rep. Kratovil introduced an amendment to H.R. 3619 to assess the prevalence and effects of the Coast Guard operating out of temporary facilities and buildings. The amendment passed unanimously. The amendment requires the Commandant of the Coast Guard to conduct a national study on the facility infrastructure requirements needed to fulfill the Coast Guard’s prescribed missions and capabilities.
In Maryland’s First District, the Coast Guard station at Oxford operates out of a double-wide, temporary trailer, which it shares with the National Oceanographic and Atmospheric Association. The Oxford station also lacks a pier, forcing the Coast Guard to lease space at a commercial pier nearly a mile away from the temporary trailer. Kratovil is concerned that this and other “temporary” arrangements could be affecting operations and mission capability.
The amendment requires a report to Congress that must include:
· An assessment of any shortfalls in facility infrastructure, including the extent of the use of temporary trailers;
· An inventory of the number and type of new facilities needed to meet the service’s mission; and
· A plan for how the Commandant of the Coast Guard will develop the appropriate facility infrastructure, including timelines, budgets, and any additional legislative authority the Commandant determines is required to implement the plan.
Click here to read the amendment.“The amendment is a common sense means toward ensuring those entrusted with protecting our coast and shorelines are being given the right tools and facilities to do so effectively,” said Rep. Kratovil. “I am pleased that my colleagues are equally committed to ensuring the Coast Guard has top notch facilities and infrastructure in order to effectively play their part in keeping America safe.”
Cost over a decade much higher than target President Obama has set
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