MRAA details provisions of small-business law

Author:
Updated:
Original:

The Marine Retailers Association of America issued a membership advisory today on the tax provisions of the small-business lending bill that President Barack Obama signed into law on Monday.

In addition to revisions to the Small Business Administration's loan programs that were identified in an earlier membership advisory, the new law provides several tax relief changes that benefit small businesses.

The tax changes in the law are temporary  and apply to tax years 2010 and 2011. Among the points noted by MRAA:

  • Temporary general business credit changes - In 2010, businesses with less than $50 million in gross receipts will be able to carry back general business credits to offset tax liabilities for five years; those credits could be applied against the alternative minimum tax.
  • Section 179 expensing - The changes allow for more lucrative allowances by doubling the first year write-off for business equipment under Section 179 from $25,000 to $50,000 and raising the cap on eligible expenditures that triggers a phase-out of the incentive from $800,000 to $2 million. The law will expand Section 179 to cover improvements to some real property. These improvements expire in 2011.
  • Bonus depreciation - The law will restore through 2010 the 50 percent first-year depreciation for some kinds of property.
  • Deduction for health insurance costs - The law will permit self-employed business owners to deduct their family's health insurance expenses from self-employment tax income in 2010.
  • Built-in gains tax - Normally, when a company converts from a C corporation to an S corporation, it must retain its assets for at least 10 years or pay a 35 percent tax on the built-in gains that occur before the company made the conversion. The law will reduce the period to five years for an asset sold in the 2011 tax year.
  • "Listed" tax shelter disclosure penalty - The law will limit the penalty for failing to report on a tax return a transaction that the IRS has identified as an abusive tax shelter. It will be set at 75 percent of the tax benefit and be capped at $200,000 for corporations and $100,000 for individuals.

Related

MarineMax Posts Record Q2

Coming off its most profitable fourth quarter, first quarter and fiscal year, the company continued to roll with a 70 percent increase in revenue.

MMTA Lands State Grant

Massachusetts Marine Trades Association will use the $20,000 recovery grant to promote its “Stay Local Boat MA” program.

Hundreds Stream ABC

Topics of discussion during Day One of NMMA’s virtual American Boating Congress included policy updates, infrastructure, the global supply chain and more.

Next Stop, Key West

The Moorings adds the Conch Republic to its roster of charter bases.

IBEX to Host Supply Chain Webinar

The April 29 session will address logistical issues that continue to impact manufacturers amid strong customer demand.

Safety is no Accident

Sure, it’s a cliché, but it’s 100 percent accurate. With boats going in the water for a new season in many areas, dealers should wave the safety flag wide and high, especially for the newcomers.

Brunswick Recognized for Diversity

Forbes ranks Brunswick as one of the top employers for diversity for the second consecutive year.

ABYC names Content Director

Sarah Devlin will support ABYC’s events and communications, distributing content through various channels.

Ferretti Group Reports Strong Q1

The conglomerate saw revenues increase by 40 percent, with a record 56 yachts launched in the first quarter.