Posted on 10/07/2004 2:24:19 PM PDT by ChuckShick
Lawmakers are looking to trim tax break for small business owners to $25,000 from $100,000.
October 7, 2004: 1:14 PM EDT WASHINGTON (Reuters) -
Congressional negotiators closed a controversial tax loophole on Wednesday that allowed small business owners to write-off the full cost of the biggest and most expensive sport utility vehicles. The auto deduction is part of a long-standing tax provision covering depreciation of business expenses.
It was originally intended for farmers and construction workers who need heavy duty vehicles to haul goods and materials. Lawmakers expanded the popular write-off from $25,000 to $100,000 last year and lifted depreciation schedules to enable taxpayers to take the deduction all at once.
This created a huge incentive for anyone running their own business to buy big SUVs, which have skyrocketed in popularity.
(Excerpt) Read more at money.cnn.com ...
IIRC, you could only accelerate the write off, not write off more. Business deduction is still there.
I need to buy a farm pick up truck. Wonder if this will apply to THAT too.
Doesn't F'n have an SUV. Oh, that's right, it belongs to his family.
Forcing small businesses to haul stuff around in Geo Metros, driving up costs and delays.
Isn't the depreciation schedule being reinstated so it can't be taken all at once? Also the deduction is being reduced by 75%.
I beleive there is a weight minimum which limits it to Hummers, Ford Excursions etc.. The really loades SUVs. But I'm sure a nice dual axle would weigh enough.
This is what happens when you have a convoluted income tax system. Politicians cave in to pressure from liberal special-interest groups, and rewrite legislation that affects other groups. If they're going to kill this loophole then they might as well kill all tax loopholes and deductions and just implement a damn flat tax. This will definetly hurt seasonal and self-employed people. Seriously, it's time the people rise up and demand a simple tax code without all the B.S.
Thanks. I'm sure I'll be buying a smaller truck. Don't need a huge one.
The weight minimum was fudged quite a bit. You could even use the deduction on a BMW X-5, which doesn't have much of a GVW compared to an Excursion or Hummer.
dont know about the new legislation, but the old law just accelerated depr., not upped it.
THANK GOD THE GOVT HAS FOUND ANOTHER WAY TO GET MORE TAXES!
/sarcasm
They should have extended the tax write-off to ALL vehicles.
"I need to buy a farm pick up truck"
You cannot take the Section 179 deduction if that business did not make a profit.
We have tree farms, but of course, they do not make a profit yet. Bought a tractor this year, have to depreciate it. It would be eligible for 179, if we had the profit to cover the deduction! LOL!
"This deduction stimulated growth in the economy by stimulating business equipment purchases."
Exactly. Buying SUVs is good for the economy. Tell it to the auto workers.
Rats. I was going to buy one in 2005.
Now I won't.
Tax policy changes have unintended consequences.
And I was wanting to buy one of those new Escape Hybrid SUVs... dang.
Don't get too upset by this. This loophole was mostly used by lawyers and doctors as a way to write off their family Hummer or Navigator.
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