Today, the House Committee on Ways and Means held its first markup of tax legislation in several years to consider six separate pieces of legislation. All six bills would make certain expired or expiring tax provisions permanent, including tax incentives important to businesses of all sizes. Although the votes on the measures were mainly party-line votes, these measures (frequently called “tax extenders”) are among many that lawmakers from both parties have been supportive of in the past to boost economic growth and development, especially among small businesses.
One bill, H.R. 4457, would permanently extend the limit on Section 179 small business expense write-offs to $500,000. Since the previous tax extender expired at the end of 2013, the current write-off is only $25,000. This provision, which the Committee approved by a 21-14 vote, is among the most important tax extenders for franchise small businesses, and IFA has consistently advocated for its inclusion in tax extenders packages proposed in recent years.
Another measure, known as the “CFC look through” rule, addresses the treatment of payments between related controlled foreign corporations, and allows multinational companies to more easily move money between foreign subsidiaries. The Committee passed this measure by a vote of 22-14. A third bill, which passed by a vote of 21-13, addresses the tax implications of companies converting to Subchapter S, or “pass-through,” tax status. The Joint Committee on Taxation (JCT) estimates that the six measures will cost a combined $310 billion over a 10-year period.