|
New in 2005, tax deductions for domestic production activities can permanently lower the tax rate for companies in any of these industries:
- Manufacturing
- Production Activities
- Construction
- Oil & Gas
- Architectural Services
- Engineering Services
- Electricity
- Potable Water
- Computer Software
- Mining
- Film, Video, Sound Recording
- Food and Beverage
- Agriculture and Livestock
Section 199 now permits taxpayers to claim an extra deduction for income attributable to domestic production activities. This will allow complying companies to reduce their taxable income via a phantom or hypothetical deduction designed as an added incentive for companies to continue and expand production activities within the U.S. This rate reduction is permanent and falls directly to the bottom line.
The new law is effective for tax years beginning after December 31, 2004 so most companies have not yet begun to analyze which activities qualify or set-up procedures to capture this benefit.
As with many tax laws, there are numerous detailed requirements that need to be met in order to claim these additional deductions. The professionals at
HEIN & ASSOCIATES LLP can help you determine if you meet those requirements to reap the tax benefits of these activities.
|
|
