(Posted Wed. Dec 17th, 2014)
The National Corn Growers Association today asked President Barack Obama to sign the tax extenders bill passed by the Senate Tuesday, but also urged broader tax reform in 2015.
“HR 5771 is an important but temporary first step to tax laws that allow farmers to reinvest in their operations. We urge the President to sign this bill into law,” said NCGA President Chip Bowling.
If signed by President Obama, the bill will retroactively extend a package of more than 50 expired tax breaks through the end of 2014. Included among them is the Section 179 provision, which maintains the expensing limitation at $500,000 per year and a 50 percent bonus accelerated depreciation for the purchase of new capital assets.
These provisions are particularly important to farm operations, which require a significant investment in machinery and equipment.
“A new tractor, grain bin, or pivot will be nice to have under the Christmas tree,” said Bowling. “But farmers shouldn’t have to wait until the last two weeks of the year to find out whether they can afford to reinvest in their operations. This waiting game has a ripple effect across the agriculture industry and rural communities. NCGA looks forward to working with the next Congress to provide farmers with the certainty they need to make long-term business decisions.”
Legislation At a Glance
On Tuesday, the Senate passed H.R. 5771, a bill to retroactively extend more than 50 tax relief provisions for 2014, behind a strong push from national agriculture groups and business constituencies. The bill now awaits President Obama’s signature. NCGA appreciates the efforts of our members and grower leaders who helped deliver a strong message of support for this legislation.
Key provisions of the bill include the following:
Business Tax Extenders: The top tax extenders advocated by NCGA included in the bill are the Section 179 provision, which maintains the current expensing limitation at $500,000 per year and a 50 percent bonus accelerated depreciation for the purchase of new capital assets.
Energy: The bill reinstates the tax credit for second-generation biofuel production as well as income and excise tax credits for biodiesel and renewable diesel fuel mixtures. In addition, the tax credits for producing electricity using wind, biomass and other renewable energy sources are extended through 2014.
Waterways: The barge diesel user fee will increase from 20 cents per gallon to 29 cents per gallon, effective April 1, 2015. The fees go toward the Inland Waterways Trust Fund (IWTF), which finances construction and major rehabilitation on the nation’s inland waterways. The fee increase is expected to generate $260 million over the next 10 years. The user fee will be used for repairs along most of the largest waterways, including the Ohio, Mississippi and lower Missouri Rivers, as well as the Gulf and Atlantic Intracoastal waterways, supporting 257 locks at 212 sites. The Ohio and Mississippi River systems carry nearly 90 percent of the tonnage transported on inland waterways. NCGA and other agriculture groups have advocated for this increase for many years.