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Incoming Business Tax Breaks 2024!

Audio version available here:

Length: approx. 1 min. 40 sec.


Great news for business owners! Congress has come to a rare consensus and unveiled its plan to provide tax breaks to both families and Main Street. Though it is not yet passed, The Tax Relief for American Families and Workers Act of 2024 has bipartisan support. Part 2 of the act, titled American Innovation and Growth, would benefit business owners.


First, it includes a delay to the required 5-year deduction timeline of research or experimental costs “until taxable years beginning after December 31, 2025”.


Second, it allows adjustments for how the limits on business interest deductions are determined. Between December 31st, 2023 and January 1st, 2026, taxpayers could elect to calculate their adjusted taxable income (ATI) with regard to “earnings before interest, taxes, depreciation, and amortization (EBITDA)”, rather than simply “earnings before interest and taxes (EBIT)”.


Third, 100% bonus depreciation would be extended to qualified property placed in service between December 31st, 2022, and before January 1st, 2026.


Fourth, the Section 179 expensing maximum would increase from $1 million to $1.29 million. The $1.29 million limit must be reduced by the amount of the qualifying property’s cost that exceeds $3.22 million.


Combined with its expanded child tax credits and global competition tax benefits, lawmakers hope to pass the act through the Republican House and Democratic Senate before tax season begins on January 29th, 2024, so taxpayers can take advantage of its provisions when filing their 2023 taxes. However, worries about a government shutdown may cause a delay.


Because of this, it’s important to follow XQ CPA’s blog and social media for the latest updates. We will provide the most up-to-date business and tax news for business owners like you.


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Excited business owner in black suit holds two handfuls of $100 bills

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