Small Business Tax Relief - Good. Clawback for Sale-In, Lease-Out Big Problem

Last week, the House of Representatives passed the Small Business Tax Relief Act of 2007 (HR 976). This bipartisan legislation, introduced by Ways & Means Chairman Charles Rangel (D-NY) and Ranking Member Jim McCrery (R-LA), was approved by a vote of 360 to 45.  Now the bill goes to the Senate. 

Here's the issue:  Although it was the subject of debate, the House Bill did not contain a provision to recoup (or "clawback") tax breaks for SILO transactions (essentially a financing devise with favorable tax treatment for banks that count lease payments as income and depreciate the corresponding capital assets purchased by the bank and leased out).  Will the Senate now include such a provision?  The Financial Services Roundtable and the American Bankers Association are on record as strongly opposing such a retroactive provision.

Link to Feb. 16, 2007, Financial Services Rountable Newsletter, which discusses the issue and should be updated shortly to reflect the current bill status:  http://www.fsround.org/pdfs/bulletins/16February2007WeeklyBulletin.pdf

Link to House Ways & Means Committee Press Release:  http://waysandmeans.house.gov/

(ag) Feb. 22, 2007, in Congress