‘Bailout Bill’ Includes Ag Aid
October 8, 2008 The Emergency Economic Stabilization Act (H.R. 1424), after being voted down Sept 29 in the U.S. House of Representatives, was quickly amended and approved, 74-25, by the U.S. Senate on Oct. 1 and then by the House on Oct. 3 by a 263-171 vote. President George W. Bush signed the bill into law just hours after the House passed it.
There are several ag-related incentives included in the “bailout bill.”
The bill would extend the $1 per gallon biodiesel production credit and the 10-cent a gallon small biodiesel producer credits to the end of 2009. The bill also extends the $1 credit for producing diesel fuel through biomass and makes it easier for renewable-diesel refiners to receive the tax credit. The bill also would retroactively eliminate the controversial practice of "splash and dash" that allowed tax credits to biodiesel producers overseas for simply docking at U.S. ports and blending in diesel fuel.
The bill also adds two provisions for infrastructure in the ethanol industry. One is a tax clarification that would give ethanol pipelines the same tax status as pipelines for other fuels such as gasoline. Another provision extends a 30 percent tax credit through 2010 for gas stations that install E-85 pumps. Electric vehicle charging pumps were also added to that credit as well.
The bill also establishes a five-year depreciation period for most machinery or equipment used for farming, as long as it is placed in service between Jan. 1, 2009 and Jan. 1, 2010. Grain bins, cotton gins, fences, or other land improvements are excluded from the change.
Other provisions would impact your grower-customers in the flood-disaster or hurricane zones. For instance, growers and other businesses could deduct $100,000 more than normal under the Section 179 equipment expensing deduction. The amount of equipment a business could by under that provision before getting hit with a phase-out of the deduction increases to $600,000 as well.
(Sources: DTN, Wikipedia, American Soybean Association)
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