Permanent Home Office Deduction Bill Introduced in Senate

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Permanent Home Office Deduction Bill Introduced in Senate

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By Kristie L. Arslan

Prior to the July 4th recess, Senators Tom Udall (D-NM) and John Boozman (R-AR) introduced bi-partisan legislation (S. 1260) to make the home office deduction permanent. While the Department of Treasury and Internal Revenue Service announced in January that they would offer a simplified home office deduction calculation for the 2013 tax year, the intent of the new legislation is to ensure that the Treasury Department’s administrative action cannot, at a later time, be reversed by a future administrative declaration.

New Mexico is home to nearly 121,017 self-employed businesses, while Arkansas self-employed numbers fall just shy of 200,000. So it is no wonder that with the high number
of self-employed constituents in their states, Senators Udall and Boozman champion a legislative guarantee of a permanent home office deduction.

In other unrelated news, the Department of Treasury announced on July 2, 2013 that it would delay the enforcement of the employer mandate of the Affordable Care Act for one calendar year, pushing it to 2015. The employer mandate required businesses with 50 or more employees working more than 30 hours per week to provide comprehensive health insurance that met the essential health benefits requirements or face a $2,000 per-employee penalty.

In its notice, the Department acknowledged the immense challenges faced by the business community in meeting the 2014 deadline. At the heart of the issue is the 30-hour work week definition. Many businesses in various sectors have been pushing for a legislative fix to raise the hours per week to the traditional 40-hour per week definition of full-time employment. Senators Joe Donnelly (D-IN) and Susan Collins (R-ME) recently introduced legislation, S. 1118, Forty Hours is Full Time Act, that would raise full-time definition to 40 hours per week.

However, the Administration doubled-down on its confidence that the individual marketplace (Exchanges) will be ready to start enrolling Americans on October 1, 2013.

Kristie L. Arslan is president and CEO of the NASE and provides critical insight to policymakers on issues affecting our nation’s self-employed. You can contact her

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