Latest industry Trends Watch:
Spader Online Services
Advertise with NAEDA > >
Follow us on Twitter > >
For the last two years about this time, Jack Selzer, NAEDA’s Tax Attorney has provided the basic tax depreciation/expense rules that can help sales people in making new and used equipment sales before year end. Because of some changes, it is timely to revisit these rules.
There are two provisions we need to look at --
Section 179 expense deduction for new and used equipment. The Section 179 deduction for 2013 is $500,000. There is a “phase out” $ for $ after the purchase of $2,000,000 of new and/or used equipment. This if a customer has $2,500,000 of purchases in 2013 there will be no Section 179 deduction. This phase out shows that this deduction is designed for small and mid-sized businesses.
Bonus depreciation for new equipment. Like last year, the extra additional bonus depreciation is 50% of the purchase price of new equipment. Example – if a customer buys new equipment in 2013 for $600,000 the customer can take an extra $300,000 bonus depreciation deduction in 2013.
The expiring farm bill is caught up in the drama of over passing a continuing resolution to fund the government beyond next Monday. Complicating the situation is the Republicans’ demand to cut spending and taxes, defunding the Affordable Care Act and the debt limit increase. The House also now needs to pass a procedural motion to combine the farm bill and the just-passed nutrition bill before farm bill conferees can be named.
Then the two bills will go to the Senate where they can accept them or reject them, which is most likely to mean a rejection to occur. After they reject them, they should ask for a conference. Then both the House and Senate will appoint conferees. Since they are not in session until Wednesday, it’s probably the following week before conferees can be appointed.
The House and Senate both make cuts in food stamps, but the level of those cuts is far apart. Both chambers also take a different policy approach to the commodity title. Depending on how these differences are worked out in the conference, will depend on whether the President will sign the final bill. Only time will tell that final outcome, but both the House and Senate Agriculture Committee Chairs appear to remain committed to getting a farm bill on the books this year.
Most dealers use and store hazardous chemicals in their workplace. Products ranging from cleaners to lubricants to paint contain OSHA-regulated hazardous chemicals. Dealers are not alone - OSHA estimates more than 5 million businesses in the United States use hazardous chemicals. If you are like most dealers, OSHA’s recently revised Hazard Communication Standard applies to your business and you have work to do before December 1.
Legislation was introduced last week by Rep. Blake Farenthold (R-TX) titled the Innocent Sellers Fairness Act. The bill limits the instances under which distributors and retailers could be subject to a product liability lawsuit. The legislation is similar to a bill NAEDA supported in 2007, but is slightly different than previous versions of the legislation. But, we believe it still does a good job of limiting the instances where sellers would be subject to product liability lawsuits.
Rep. Farenthold’s office has asked National Lumber & Building Material Dealers Association (NLBMDA) to organize an industry letter in support of the bill of which NAEDA has agreed to sign-on to. Rep. Farenthold will also be circulating a Dear Colleague letter seeking cosponsors.
The bill was not introduced in the last Congress, but it was introduced in the 109th, 110th and 111th Congress.
Saskatchewan equipment dealers are addressing a labor shortage by taking matters into its own hands. Saskatchewan is short about 400 agriculture machinery technicians, meaning farmers often lose valuable time waiting on help when equipment breaks down. The Canada West Equipment Dealers Association made a commitment of $57,000 to double the amount of spaces in the ag machinery tech program at SIAST. That will cover half the cost. The remainder will be picked up by the province and through student tuition.
NAEDA has filed comments with the IRS concerning their notice on dual use property. NADEA followed others in the industry who also filed with the IRS including AED and Caterpillar.
What the IRS will do next is anybody’s guess. The IRS could initiate an Industry Issue Resolution process to negotiate a safe harbor with the industry, develop guidance through some other route, or drop the issue all together. However, given the fact that the IRS itself proposed to undertake this exercise, we think the latter option is the least likely.
Copies of NAEDA's and AED's filings can be found here.
The Supreme Court on Monday declined to review a case that charged federal regulators allowed a mid-level ethanol fuel blend onto the market without proper testing.
The National Conference of Weights and Measures (NCWM) adopted a new standard in 2012 that regulates vehicle engine (motor) oil. This standard will impact equipment dealers in several states enforceable on July 1, 2013. The new standard requires invoices or receipts to include vehicle engine (motor) oil information, as well as, it requires labeling of any engine oil container, receptacle, dispenser or storage tank.
Tornado season is upon us and the unfortunate and catastrophic events of the past few days in Oklahoma, Texas and other areas serve as a reminder that disaster can strike at anytime, anywhere. History has also shown that these storms and natural disasters impact thousands of households and businesses including those of NAEDA members and their employees.
NAEDA’s Equipment Dealers Foundation Disaster Relief Fund helps the employees of NAEDA dealer members who have been affected by natural disasters with emergency funds to help bridge the gap financially for the employees and families until insurance or other payments come in. When faced with a disaster, the EDF has been able to step in and help. Thanks to the generous support of dealers, manufacturers, suppliers and affiliated associations, EDF has assisted more than 130 families with more than $200,000 in direct disaster grants to employees of NAEDA members.
We have already received applications and provided financial assistance to dealership employees as a result of the recent tornados in Texas and likely will see more requests from the recent Oklahoma disasters. Please consider a generous donation to the NAEDA Equipment Dealers Foundation. Donations can be made on-line on the EDF website at: https://www.naeda.com/SupportEDF/EDFFoundationOnlinePayment.aspx
WOW! Congress adjourned in December with a two-year budget deal. Who would have thought that was possible, given the fact that they are even more unpopular than the president who is going to sign this deal. Just remember Congress will be back in Washington in January to discuss a host of unfinished business after their return and the elections next fall.
Free Webinar to Watch on How to Achieve Greater Success in Hiring National Guard Members and Other Veterans