Section 179 and Bonus Depreciation Update

I seem to get more emails, phone calls and conversations regarding Section 179 and bonus depreciation compared to any other question. Both the Senate and House have either discussed or proposed several bills to extend bonus depreciation and Section 179 or make them permanent.

In my opinion none of these bills will ultimately be passed until after the Mid-term elections. About the only time any major tax bills are passed anymore is during the “lame duck” session after major elections in November every other year.

I know that farmers would like to have some clarity on this issue but as usual when dealing with law making in Congress, this clarity is somewhere between none and very little.

With lower crop prices so far this year, I would suggest more than ever to make equipment investment decisions more on economic fundamentals than tax savings.

Paul Neiffer, CPA