Posted by: Christina Crooks under Taxation on June 23, 2015 @ 2:23 pm
Manufacturers know all too well that Congress does not always operate in a way that maximizes business productivity and investment. A prime example is the package of over 50 plus temporary tax provisions, a.k.a. “tax extenders” that expired at the end of 2014 — just two weeks after Congress finally got around to passing them in the first place.
Many of the tax provisions typically found in the tax extenders package are critical to growth in manufacturing and the U.S. economy. The R&D tax credit encourages manufacturers to prioritize research and development that fuels productivity and new product development. The enhanced Section 179 expensing provision allows smaller companies to write off up to $500,000 of capital equipment immediately, and the “bonus depreciation” provision would allow companies of all sizes taxpayers to expense 50 percent of the cost of new machinery, equipment and other essential capital investments. Additionally, the look-through rule for controlled foreign corporations and deferral for active financing income enable manufacturers with operations beyond U.S. borders to compete effectively in the global marketplace.