Legislation aimed at fixing a tax glitch that affects Home Furnishings Association members has gained support from majorities of U.S. House and Senate members.
“The Tax Cuts and Jobs Act made historic, positive changes to the federal tax code, including allowing businesses to immediately write off costs associated with improving facilities instead of having to write off those expenses over a long period of time. An inadvertent drafting error (prevented) restaurants, retailers and other leaseholders from taking full advantage of these updated expensing rules, resulting in cost-prohibitive renovation projects and stalled investments.”
The tax fix “would ensure the full cost of store, office or building improvements can be immediately expensed as was originally intended.”
Schultz explains why tax fix is needed
Toomey’s office quoted Matt Schultz, president of HFA member John V Schultz Furniture in Erie, Pa.:
“In the past year our family furniture business has undergone significant growth and made large investments with the opening of two new furniture stores in Erie and Pittsburgh,” Schultz said. “This investment has nearly doubled our employment with the addition of over 100 jobs to our company. Now we have placed two large investment projects on hold as a result of the current tax language not allowing us to deduct these building improvements on our tax return as in the past. By passing this bill, it will allow us to continue our business growth plan that will help further create jobs both for our company as well as our local community.”
Toomey’s bill has attracted 51 co-sponsors. An identical bill in the House, H.R. 1869, has gathered 246 co-sponsors. Support for both bills is bipartisan.
Coalition unveils tax fix website
Senators and representatives have responded to a lobbying effort by a broad coalition of business groups, including HFA. Among other members are the National Retail Federation, National Restaurant Association and National Grocers Association. The coalition recently unveiled a website called Fix the Glitch. Furniture retailers and other business owners can use the site to write to their senators and representatives and urge Congress to pass the bills. Despite majority support in the House and Senate, the bills won’t proceed without the consent of legislative leaders of both parties. They are more likely to advance the bills if they come under enough pressure from their members.
Positive action will help furniture retailers grow their businesses and boost the economy.