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Kerry Gives Remodeled Small Businesses a Tax Break
WASHIGNTON – Senator John Kerry (D-Mass.) is the leading cosponsor of bipartisan legislation to help small business owners remain more competitive by allowing them to spread their tax breaks for renovations and remodeling over 15 years instead of 39, as the current law requires. Today entrepreneurs who own their business’ real estate are at a disadvantage compared to business owners who lease their space who can spread their renovation depreciation costs over 15 years.
“Small business owners – whether they own or lease – shouldn’t be treated differently. This legislation levels the tax law playing field for Main Street store owners and will help keep them competitive,” said Kerry, the top Democrat on the Committee on Small Business and Entrepreneurship. “Businesses need to remodel regularly to keep up with their customers, so our tax laws should keep up with them.”
The Treasury Department, the Congressional Research Service, and private economists have found that the depreciation life for renovations is far too long. These tax rules generate high tax costs, laying the burden on small town, rural retailers who are more likely to own their property than retailers in urban areas. This legislation, sponsored by Sen. Olympia Snowe (R-Maine) and cosponsored by Sens. Blanche Lincoln (D-Ark.) and Kay Bailey Hutchison (R-Texas), addresses this inequity by reducing the 39-year tax depreciation period to 15 years.