With the elections over and newly elected members not assuming their roles until January, there is still unfinished business that the 113th Congress must address in a post-election lame duck session that begins this month. The lame duck is the last opportunity to get the expensing provisions extended this year.
The most pressing item on the agenda, however, is funding the government beyond Dec. 11, 2014. Even though the 2015 fiscal year began on Oct. 1, Congress did not pass any of the appropriation bills necessary to continue funding the government beyond Sept. 30. That made it necessary to quickly pass a Continuing Resolution to continue funding until after the elections. The CR that ultimately passed Congress and was signed into law by the president includes funding at FY14 levels through Dec. 11, 2014.
There is also serious pressure on Congress to pass a “tax extender” bill that temporarily or permanently renews the more than 50 tax provisions that expired at the end of 2013, including Sec. 179 and bonus depreciation. Earlier this spring, the Senate failed already to pass a bipartisan package that would have extended the bulk of the expired provisions for the 2014-2015 tax years because of a partisan dispute over amendments. The House took a different approach and passed separate bills to make permanent expanded Section 179 and 50 percent bonus depreciation. In the end, repeated attempts to either temporarily or permanently extend the provisions before Congress adjourned in September failed despite strong support from the business community.
All eyes are now on the lame duck. Senate Finance Committee Chairman Ron Wyden (D-OR)remains committed to passing the 2-year temporary “tax extender” package that was approved by his committee by the end of the year. Some House Republicans, however, would like to delay action on the tax extenders package to 2015 in the hopes of making some of the fixes permanent. That would have to be done immediately at the start of the new session if the fixes were to apply to 2014, since tax returns must be filed by mid-April. The IRS Commissioner has warned Congress that continued delays will disrupt the tax filing season.
The likely outcome: The House will work with the Senate to approve a package that temporarily extends the provisions for the 2014 and 2015 tax years. That gives the new 114th Congress a clean slate with which to start to tackle comprehensive tax reform. If the extenders do get pushed to January, the new Congress will take up the issue immediately.
AMT and other manufacturing groups have mounted a campaign to get the extender bill, particularly the depreciation provisions, enacted before the end of the year. On Nov. 10, a letter, spearheaded by the U.S. Chamber of Commerce and signed by AMT, urging swift passage of a bill will be sent to Congress.
Your federal lawmakers need to hear from you TODAY about the importance of Sec. 179 and bonus depreciation to U.S. productivity and competitiveness. Let them know that the sooner a manufacturer can recover the cost of its old equipment, the sooner it will invest in new equipment. Innovation in manufacturing technology far outpaces the lives of most of the industry’s products.
For updates on this issue and others affecting the manufacturing technology industry, visit the MFG Advocate blog at www.mfgadvocate.com.
To find contact information for your members of Congress, visit AMT’s Legislative Action Center by clicking on the American flag on the AMTonline homepage.