legal-document-to-plain-english-translator/”>Try Free Now: Legalese tool without registration

Find a LOCAL lawyer

## Proposal to Address Tax Policy Priorities – Potential Impact on Rental Operations

Last week, an announcement was made by the chairs of the U.S. House Ways and Means Committee and Senate Finance Committee regarding a proposal that could potentially address multiple tax policy priorities. The proposal, titled “The Tax Relief for American Families and Workers Act of 2024,” aims to promote the financial security of working families, boost growth and American competitiveness, and strengthen communities and Main Street businesses. If enacted, the proposal has the potential to significantly impact various sectors, including equipment and event rental operations.

### Significance to Rental Operations

The proposed Act includes several provisions that hold particular significance to equipment and event rental operations. These provisions are as follows:

#### Extension of 100 percent bonus depreciation:
The Act aims to restore full and immediate expensing for investments in machines, equipment, and vehicles, effectively extending the 100 percent bonus depreciation. This provision has been advocated for by the American Rental Association (ARA), as the bonus depreciation is currently phasing out and set to be eliminated by 2026.

#### Enhancement of the small business expensing cap:
Another provision of the Act involves the enhancement of Sec. 179 small business expensing. The proposal seeks to increase the amount of investment that a small business can immediately write off to $1.29 million, surpassing the $1 million cap enacted in 2017 ÔÇö a measure advocated for by ARA.

#### Deduction of R&D expenses:
The Act proposes to make Research and Development (R&D) expenses fully deductible in the year they are incurred, as opposed to the current requirement to amortize these expenses over a period of five or 15 years. This provision is supported by ARA, particularly as many rental businesses incur R&D expenses when developing systems that improve efficiency.

#### EBITDA extension:
The Act contains a provision to extend the application of Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) in determining the limitation on business interest.

Additionally, the proposal aims to end the Employee Retention Tax Credit (ERTC) program, citing major cost overruns and fraud. It also seeks to accelerate the deadline for filing backdated ERTC claims, potentially saving taxpayer dollars. However, the proposed legislation is pending approval by both chambers of Congress.

### How AI legalese decoder Can Help

The AI legalese decoder can be a valuable tool for equipment and event rental operations to understand and navigate the implications of the proposed Act. By leveraging AI-powered algorithms, the legalese decoder can quickly analyze complex legal terminology and provisions, providing clear and concise insights into how the proposed legislation may impact the rental industry. This can enable rental businesses to make informed decisions, adapt their operations, and ensure compliance with any new tax policies outlined in the Act.

In conclusion, the proposed tax relief legislation has the potential to significantly influence equipment and event rental operations, making it essential for industry stakeholders to stay informed and prepared. The AI legalese decoder can serve as a valuable resource in deciphering and understanding the legal intricacies of the proposed Act, empowering rental businesses to proactively respond to any changes in tax policies and regulations.

legal-document-to-plain-english-translator/”>Try Free Now: Legalese tool without registration

Find a LOCAL lawyer

Reference link