The Building Owners and Managers Association (BOMA) International joins President Bush as he urged Congress during his State of the Union address to renew the tax cut legislation enacted during his first term in office. The President requested Congress make permanent the reduced rate on capital gains and the time frame for which cost recovery for leasehold improvements on office property are depreciated. The lowered capital gains tax rate is set to expire after 2008 and the leasehold depreciation recovery provision already expired at the end of 2005; both are top BOMA International legislative priorities.
“By further extending the President’s tax cuts, Congress will continue to provide business owners the incentive necessary to continue to help contribute to a healthy economy.” said BOMA International Chairman, David W. Hewett, RPA, CPM, CCIM, FMA, CFM, principal for Trammell Crow Company, Auburn Hills, MI. “BOMA International supports the President’s tax relief efforts that foster an economic environment that will create more American jobs in the commercial real estate industry.”
BOMA will continue to urge Congress, as it returns this week for the second half of the 109th session, to extend, if not make permanent, these two extremely critical tax provisions. Early this month the House and Senate are expected to name conferees tasked with hammering out the differences in the two tax reconciliation bills passed last year. Both bills contain language extending the leasehold improvement depreciation for another year, but the Senate bill does not include a provision to further extend the cut on capital gains. BOMA will urge conferees to eliminate taxes on capital gains and permanently reduce the timeframe for which leasehold improvements may be depreciated from 39 to 15 years. If renewed, the leasehold depreciation would most likely take effect retroactively to the beginning of the year.