To provide a boost to the home furnishings industry, several industry trade associations are asking Congress and the new Obama administration for tax incentives to offset product purchases and home improvements and help industry companies.
The American Home Furnishings Alliance, the International Sleep Products Assn. and the National Home Furnishings Assn. are proposing a two- to three-year refundable tax credit for the purchase or installation of home furnishings.
A credit of 10% to 20% would be available to renters or homeowners making $50,000 or less. The proposal also includes a 10% tax deduction, capped at $2,000, for furniture purchases for individuals with incomes under $150,000 and for couples with incomes under $250,000.
Commercial, retail and contractor incentives would include:
+ A 10% refundable tax credit for inventory purchases of building products.
+ A tax deduction for bad debt based on historical experience, rather than when the debt is proven to be uncollectible.
+ A capped tax credit for commercial and investor taxpayers on the purchase of building products otherwise considered to be ordinary and necessary building expenses, such as paint.
+ A 50% bonus depreciation in the year of purchase for depreciable building products for commercial and investor taxpayers.
Other trade groups supporting the incentives include the Carpet and Rug Institute, the Kitchen Cabinet Manufacturers Assn., the National Paint and Coatings Assn, the Resilient Floor Covering Institute and the World Floor Covering Assn. The groups call themselves the American Home Furnishings and Building Products Coalition.
"Incentives for the purchase of home furnishings and building products will help boost the housing market, help low and middle income taxpayers, and directly protect American manufacturing and retail jobs," AHFA CEO Andy Counts said in a statement.
The groups project that the incentives would help generate $128 billion for the U.S. economy over two years and also would generate 352,000 U.S. jobs in retail, manufacturing and contractor services. Of the total, the incentives are expected to generate a combined $102 billion for home remodeling and other home improvements and $26.2 billion in home furnishings product sales. read more
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