NLBMDA backs retail improvement legislation fix
The National Lumber and Building Material Dealers Association (NLBMDA) said it supports recent action taken by a pair of congressman to introduce the Restoring Investments in Improvements Act.
The proposed legislation would fix a drafting error in the Tax Cuts and Jobs Act while benefiting interior upgrades at retail stores.
The NLBMDA issued the following statement regarding the plan:
The National Lumber and Building Material Dealers Association praises action taken yesterday by Reps. Jimmy Panetta (D-CA) and Jackie Walorski (R-IN) to introduce the Restoring Investments in Improvements Act (H.R. 1869, S. 803), which would fix a drafting error in the Tax Cuts and Jobs Act, and make interior improvements to retail stores eligible for accelerated bonus depreciation.
Congress intended for remodeling and other store improvements to be eligible for accelerated bonus depreciation and a 15-year recovery period. Investments in qualified assets are eligible under the new tax law for 100 percent bonus depreciation through 2022.
However, a technical error in the tax reform law mistakenly excludes many interior improvements to retail businesses and restaurants from accelerated bonus depreciation and requires them to be written off over 39 years. This means affected businesses are only able to write off 2.5% in the first year and then depreciate the remainder over the next 38 years.
The legislation corrects the drafting error allowing interior improvements to retail stores and restaurants to be eligible for accelerated bonus depreciation and a 15-year recovery period. An identical bill was introduced in the Senate by Sens. Pat Toomey (R-PA) and Doug Jones (D-AL) earlier this month.
“NLBMDA is pleased to see momentum building in Congress to address the unfair tax treatment of interior improvements that is discouraging business investment,” said Jonathan Paine, NLBMDA president and CEO. “Congressional action is needed to unlock the full benefits of tax reform for lumber dealers.”
NLBMDA members plan to meet with lawmakers regarding this issue on April 2 as part of the Spring Meeting and Legislative Conference in Washington, D.C.
The proposed legislation would fix a drafting error in the Tax Cuts and Jobs Act while benefiting interior upgrades at retail stores.
The NLBMDA issued the following statement regarding the plan:
The National Lumber and Building Material Dealers Association praises action taken yesterday by Reps. Jimmy Panetta (D-CA) and Jackie Walorski (R-IN) to introduce the Restoring Investments in Improvements Act (H.R. 1869, S. 803), which would fix a drafting error in the Tax Cuts and Jobs Act, and make interior improvements to retail stores eligible for accelerated bonus depreciation.
Congress intended for remodeling and other store improvements to be eligible for accelerated bonus depreciation and a 15-year recovery period. Investments in qualified assets are eligible under the new tax law for 100 percent bonus depreciation through 2022.
However, a technical error in the tax reform law mistakenly excludes many interior improvements to retail businesses and restaurants from accelerated bonus depreciation and requires them to be written off over 39 years. This means affected businesses are only able to write off 2.5% in the first year and then depreciate the remainder over the next 38 years.
The legislation corrects the drafting error allowing interior improvements to retail stores and restaurants to be eligible for accelerated bonus depreciation and a 15-year recovery period. An identical bill was introduced in the Senate by Sens. Pat Toomey (R-PA) and Doug Jones (D-AL) earlier this month.
“NLBMDA is pleased to see momentum building in Congress to address the unfair tax treatment of interior improvements that is discouraging business investment,” said Jonathan Paine, NLBMDA president and CEO. “Congressional action is needed to unlock the full benefits of tax reform for lumber dealers.”
NLBMDA members plan to meet with lawmakers regarding this issue on April 2 as part of the Spring Meeting and Legislative Conference in Washington, D.C.