16 ;e Costco Connection FEBRUARY 2016
Small-business tax breaks
CONGRESS AND THE President left a little
something under the Christmas tree for small
businesses back in December: a permanent
extension of some key business tax breaks
that expired a year earlier.
It has become an annual year-end ritual
in Washington: Lawmakers scramble at the
last minute to negotiate a deal to retroactively
reinstate popular but expired business tax
breaks for the previous year. But the deals
extend the breaks only temporarily, thus setting the stage for another last-minute legislative scramble a year later.
But this time, Congress did what many
in the business community have been wanting for years: They extended some of these
tax breaks permanently.
The research and development (R&D)
tax credit. Not only was the R&D credit
made permanent, but it was also expanded
starting this year. If your company has less
than $50 million in average annual gross
receipts, you can now claim the credit
against your alternative minimum tax (AMT).
If you have less than $5 million in annual
gross receipts, you can take the credit
against payroll taxes (up to $250,000 per
year) if you don’t have income tax liability.
Enhanced Section 179 deduction. On
January 1 of last year, the Section 179 expensing limit fell from $500,000 (with phaseout
starting at $2 million) to just $25,000 (with
phaseout starting at $200,000). The Section
179 limit has been retroactively (for 2015) and
permanently reinstated at the higher level,
and it will be indexed for inflation in future
years. Almost all types of business equipment
are eligible for Section 179 expensing, including machinery, computers, software, office
furniture, vehicles and other tangible goods.
While not permanently extended,
50 percent bonus depreciation was extended
through the end of 2019. You can immediately
expense (rather than capitalize) 50 percent of
the cost of business equipment that you purchase and place in service in 2015, 2016 and
2017. Bonus depreciation will then be reduced
to 40 percent in 2018 and 30 percent in 2019
before it’s phased out completely in 2020.
Talk to your tax adviser about how
these tax breaks could benefit your small
business.—Don Sadler is an Atlanta-based
writer who specializes in small business
have the budget, allocate some of it toward
promotion on You Tube, Facebook and other
social networks. This way you can rest
assured it can reach the right audience.
5. Measure the impact. Many popular
video platforms, such as Facebook, You Tube
and Vimeo, have built-in analytic tools that
make it easy to assess performance. Keep
a close eye on how your content is performing, and try to pinpoint any specific trends
that stand out. This data will become critical
when you set out to make your next round
As the cost of production decreases and
platforms such as You Tube, Facebook and
Vine continue to soar in popularity, small
businesses have a tremendous opportunity
to earn both mind share and market share
through high-quality original video content.
It may just be the one thing that takes your
business to the next level in 2016. C
VIDEO AND BUSINESS
CONTINUED FROM PAGE 15
In our digital editions
Click here for a video about
using video in business.
(See page 14 for details.)
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