Manufacturers know first-hand that the lack of a permanent tax incentive for R&D investment is negatively impacting US competitiveness in the global economy. Instead, the US R&D tax credit is constantly being extended temporarily and allowed to expire before companies can even consider factoring in the credit for their future investment budgets. Meanwhile, other countries are ramping up their R&D investment incentives and courting US manufacturers to look abroad. (continue reading…)
One of NAM’s goals is to make the United States the best place to manufacture and attract foreign direct investment. There are many things policy makers can do to help achieve this goal, including creating a favorable tax climate. On the flip side, there are a number of ways policy makers can make this goal even harder to achieve, for example by imposing costly, unnecessary, anti-competitive rules and regulations. A case in point is legislation—the Truth in Settlements Act—introduced by Sen. Elizabeth Warren (D-MA) and Rep. Matt Cartwright (D-PA) and several other bills that aim to change the tax treatment of fines and penalties. (continue reading…)
Under the leadership of new Chairman Paul Ryan, the House Ways and Means Committee voted to advance legislation to strengthen and make permanent the R&D tax credit. (continue reading…)
Sometimes it seems as though there’s little to agree on in Washington, D.C. but every now and again you can see the outlines of important areas of agreement. In the past day this has occurred in a little corner of the tax arena concerning what is known as enhanced Section 179 expensing and making this on and off provision permanent for small and medium sized businesses. We’ve seen the introduction of a bipartisan bill in the House, H.R. 646 by Reps. Pat Tiberi (R-OH) and Ron Kind (D-WI). This also coincided with the release of the President’s budget request to Congress includes a provision that would make enhanced Section 179 permanent (albeit at a different level than the legislative proposals) and in the Senate with the introduction of the “Start-up Jobs and Innovation Act” by Sens. Pat Toomey (R-PA), Bob Menendez (D-NJ), Pat Roberts (R-KS) and Tom Carper (D-DE). The NAM appreciates the leadership of the Senators in supporting this provision and including it in their legislation. (continue reading…)
Kudos from America’s manufacturers again go to Reps. Pat Tiberi (R-OH) and Ron Kind (D-WI) for reintroducing their bipartisan bill, H.R. 636, make enhanced Section 179 expensing permanent. This bill, “America’s Small Business Tax Relief Act” would, if enacted, put an end to what most business-owners have come to think of as a never-ending rollercoaster ride for this critical provision of the tax code. As we’ve long written about in this space, the on-again and off-again nature of too many provisions in the tax code make an already difficult competitive environment worse for too many of our nation’s small and medium sized manufacturers. As chronicled by the NAM last November during “Investment Week,” the fate of policies like enhanced Section 179 plays a role in the investment decisions of business owners across the nation. (continue reading…)
Some things like wine or scotch improve with time. Bad regulations though, do not. In fact, if anything, more time just makes it clear how unreasonable some ideas really are. (continue reading…)
The NAM has blogged previously on the need for relief from an issue that may cause manufacturers to completely close their defined benefit pension plans before they, or the participants in the plan, are ready. While the IRS granted temporary relief from this pension nondiscrimination testing problem, the NAM is urging the agency to grant a much needed extension before the relief runs out this year. (continue reading…)
For a number of years, manufacturers have been calling for an overhaul of our tax system, arguing that a simpler, fairer, more competitive and pro-investment tax system will unleash economic growth and the jobs that go with it. A study we released just last week backs this up.
A Missed Opportunity: the Economic Cost of Delaying Pro-Business Tax Reform, takes a close look at the economic impact of enacting a five-prong pro-business tax package that includes a maximum corporate tax rate of 25 percent; a globally competitive international tax system; full expensing for capital equipment; enhanced and permanent research and development incentives; and parallel changes for non-corporate pass-through businesses. (continue reading…)
It’s been said that nothing in life is certain but death and taxes. Well it appears that the President wants to double down on this certainty by proposing to expand the death tax. (continue reading…)
The Department of Treasury and IRS released new guidance last week on the ability of a company to claim the R&D tax credit on computer software that is developed primarily for the company’s internal use.
Manufacturers may be pleased with the guidance since companies are currently unable to count computer software research intended for the company’s own use as a qualified research expense for the purpose of the credit. The proposal more clearly specifies what types of software would be excluded from using the R&D credit (i.e. software used for administrative functions), and provides examples that may be helpful in determining which activities would qualify for the credit. (continue reading…)