Ad Tax? Depreciating Your Advertising???
Imagine having to depreciate 1/2 of your advertising budget over 10 years! If this crazy proposal by Congress, initiated by Dave Camp, surprisingly a Republican from Michigan succeeds that's what will happen.
The proposal would allow an advertiser to deduct on 1/2 of their ad budget in the year the expenses occur. The remaining half would be depreciated over the next 10 years. Max Baucus, a Democrat from Montana graciously says let's make it 5 years. WHAT!!!
For big business (Proctor and Gamble for instance had a 4.8 Billion dollar budget in 2012) it would be a nuisance. For small businesses this would significantly hamper their marketing budget. For instance, say you redesign your Web site and spend $3,000. You could only call $1500 an expense this year, and you could only depreciate $300 the next year if the Democrats get their way, $150 the Republicans way!
So... (and remember I'm a Web site designer not an attorney or CPA) I suggest you make sure you turn your "Advertising Web Site" into a "Financial Collection Web Site". Have us throw up a Pay Your Bill Now" page that allows you to take payments by Credit Card... now is it Advertising? Or an integral part of the way you do business? I certainly hope this doesn't come to pass, but if it does, we may be answering that question.
I understand the Governments thinking... let's get our tax revenues now. And when you watch a business blow Millions of dollars on a Super Bowl commercial, why not tax them a little. But please leave us little guys alone!