President Signs Bill with Depreciation Bonus, Sec. 179 Expensing

Congress and the adminstration seem to have their focus (somewhat) on the construction sector these days. On Sept. 27, President Obama signed the Small Business Lending Fund Act (H.R. 5297) into law, reinstating the 50 percent depreciation bonus for 2010 and giving construction businesses a key policy victory.

The legislation also creates a lending fund to provide capital for small businesses and increases Sec. 179 expensing levels to $500,000 (and the phase-out threshold amount to $2 million) for 2010 and 2011. Many of the bill’s provisions have traditionally enjoyed bipartisan support. However, in the face of the upcoming elections, the bill has been caught up in the political posturing of Democrats and Republicans.

The credit provisions of the bill include an extension of the fee waiver for SBA 504 loans, a Small Business Administration financing program, first enacted as part of the American Recovery and Reinvestment Recovery Act and a permanent increase of the maximum loan amounts to a range of $5 to $5.5 million. Larger projects are now eligible for 504 loans and borrowers who already have loans with the SBA can now return for additional funding.  Also included is a new temporary program that helps small businesses refinance existed debt.

Extending the popular 50 percent depreciation bonus for 2010 has been a top priority for associations like AED, AEM and NUCA. In recent weeks, these big construction organizations have intensified their lobbying efforts to remind Congress and the President in both parties about the importance of this issue.

Thanks to all those association and association members who took the time to contact Congress about the depreciation bonus and the impact reinstatement would have on your company.