Essay on The Protecting Americans From Tax Hikes Act Of 2015

753 Words Dec 30th, 2015 4 Pages
On December 18th President Obama signed into law “The Protecting Americans from Tax Hikes Act of 2015 (PATH)”. Being a CPA and consultant to 100’s of privately owned companies and their owners, and an observer of tax politics including lobbying of tax issues, I see PATH as the end, not the beginning of real Tax Reform.
First, kudos to Congress and the President for making more of the Tax Code Permanent and less subject to annual last minute changes.
Many in Washington, including Speaker Ryan, House Ways and Means Committee Chairman Brady and President Obama (not to mention every presidential candidate who advocates postcard tax returns) have publicly supported tax reform, which is generally understood to be a reduction of rates in exchange for significant simplification, including reductions in both tax credits and tax deductions.
PATH is a big win for capital-intensive businesses and those that invest in research and development (R&D). The ability to write-off in one year most if not all of your equipment purchases will help capital-intensive growing businesses to better manage their tax liabilities. I am grateful for the planning opportunities PATH affords many of our clients. The stimulus theory implicit in the incentives is that any increase in the deficit (about $680 Billion over 10 years) will be more than offset with additional taxes created through job creation. The cynics say that this will hurt job creation by creating more incentives to replace people with…

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