Next year’s tax season may seem a little brighter for many contractors, thanks to President Bush’s proposed budget for 2004. His plan includes several proposals to give tax relief, including a provision that increases the amount of equipment purchases small businesses can write off as expenses.
In his proposed budget, Bush wants to increase the write-off amount for small businesses from $25,000 to $75,000. According to the Associated Builders and Contractors, this is likely to encourage investment in new machinery and equipment.
For the construction industry, the FY 2004 budget isn’t all positive. Bush’s focus is clearly on homeland security and defense, with a decrease in areas such as Environmental Protection Agency wastewater aid and the Corps of Engineers construction. Funding for federal buildings programs have also been sliced, with no aid for construction of federal courthouses or prisons. Defense and military construction, however, is expected to soar.
Other benefits in Bush’s budget include an increase in the individual Alternative Minimum Tax exemption by $4,000 for singles and $8,000 for joint filers through 2005. The plan also eliminates the marriage penalty tax, ends double taxation on dividends and proposes to make tax relief that is supposed to expire in 2010 permanent.
For more articles on Bush’s budget plan, click on the link to the right.