Senate to consider extension of bonus depreciation
Bonus depreciation, a tax provision praised for boosting sales of equipment and machinery including aircraft, would be extended through 2010 under a bill recently introduced in the Senate.
The new measure was proposed by Senate Finance Committee Chairman Max Baucus (D-Mont.) and Ranking Member Chuck Grassley (R-Iowa). Also sponsoring the bill is Sen. Sam Brownback (R-Kan.). Baucus is working on a larger, bipartisan, small-business job-creation bill with the Small Business Committee and hopes to include bonus depreciation in that package.
Bonus depreciation expired at the end of 2009. “My bill would extend bonus depreciation to property placed in service in 2010,” Baucus told the Senate.
Businesses can use bonus depreciation to immediately write off 50 percent of the cost of the depreciable property. “When small businesses are able to recoup the cost of purchases more quickly, they have more cash on hand to invest back in the business and create jobs,” Baucus said.
“It’s especially important for small businesses to use this provision, since they create 70 percent of all new jobs,” said Grassley.
“Bonus depreciation can be the key that unlocks the dream of aircraft ownership for many of our members. It can lower what might otherwise be insurmountable barriers,” said AOPA President Craig Fuller. “We hope the Senate will see the economic benefit this bill would provide to both individual owners and the vital aviation sector, and act quickly to enact this legislation.”
The General Aviation Manufacturers Association issued support for the new measure.
“Bonus depreciation is a powerful incentive to purchase a GA aircraft and is proven to increase sales during difficult economic conditions,” said GAMA President Pete Bunce.
June 23, 2010