NCBA's Colin Woodall Offers More Insight on Section 179Sat, 20 Dec 2014 13:22:31 CST
You can stick a fork in it, the 113th Congress is done. Before they left town the US Senate passed the tax extenders package. That includes a revision and an amendment to section 179 of the Internal Revenue Service code that allows for a large jump in the amount of available deductions for capital purchases. Normally under section 179, its 25 - thousand dollars but the revision takes it all the way up to 500 - thousand dollars. National Cattlemen's Beef Association Vice President of Government Affairs Colin Woodall says his organization representing cattle producers across the country is glad they finally got his done.
"They waited just about as long as they could to get the tax extension package passed, but it is in place," Woodall said. "So basically what it does, it takes all of the tax provisions that expired at the end of 2013 and makes them retroactive for all of 2014."
Radio Oklahoma Network Farm Director Ron Hays featured Woodall on the Beef Buzz feature. Click or tap on the LISTEN BAR below to listen to today's Beef Buzz.
Producers can benefit from the section 179 expensing. This includes any capital purchases that have been made this year, any investment in new equipment or new buildings. Woodall said producers will also get to use bonus depreciation and the conservation easement tax incentive stayed in place. While Congress just passed this tax extenders package it is only for the 2014 calendar year. Woodall said the package will expire on December 31st and the country will be back in the same position in 2015.
With such a short life to this bill, you might wonder why Congress didn't pass a two year deal. Woodall said Democrats on the Senate side were pushing for a two year package, but when the Republicans saw President Obama might veto or threat to veto the package, especially if it didn't have more of the lower and middle class income tax credits. Woodall said once that became visible, then the House chose the path of least resistance with a one year retroactive package.
This looks to help out a lot of ag producers as well Americans in general as they now know what their tax liability will be. Woodall said that means a lot of producers will be making a lot of management decisions before the end of the year. But to take advantage of the half a million dollars in a tax deduction, producers have to buy the capital item, get it delivered and put it into service before midnight December 31st.
Starting on January 6th, the 114th Congress will be looking at this topic once again. With a Republican controlled House and Senate, Woodall is hopeful that will allow for a bigger tax reform package that will provide a longer term extension of this package or Congress will make these programs permanent.
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network- but is also a regular audio feature found on this website as well. Click on the LISTEN BAR below for today's show- and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
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