Latest News

Congress Approves Tax Bill That Can Benefit Consumers And Dealers Until December 31st

Dec 22, 2014

As the U.S. Senate wound-down its session until January 2015, legislators approved a House-passed bill (H.R. 5771) renewing several expired tax provisions that will benefit consumers and automotive retailers. The bill increases small business expensing and bonus depreciation, which will allow dealers and their customers to expense a larger portion of equipment purchases for 2014. These provisions apply to purchases in 2014 only, so dealers and their customers must act quickly to take advantage of these tax benefits. First, the bill contains a retroactive increase of the limit on business equipment eligible under Section 179 small business expensing to $500,000 for eligible new and used equipment purchased in 2014. Without this bill, the maximum eligible for Section 179 expensing in 2014 would have been $25,000. The bill also includes an extension of the 50% bonus depreciation deduction for new business equipment acquired and placed in service in 2014.In addition to these changes, there is an extension of the additional $8,000 in first-year depreciation for certain business vehicles purchased in 2014. This provision may provide substantial potential savings for your business customers, but they must purchase qualifying vehicles before December31, 2014.NADA encourages dealers and their customers to consult their tax advisors to determine the exact amount of their potential tax savings, which is dependent on their own particular tax situation and the interplay of the provisions described above.