THE COMPUTER EQUIPMENT COMMON SENSE DEPRECIATION ACT -- HON. MAC COLLINS (Extensions of Remarks - April 26, 1999)

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HON. MAC COLLINS OF GEORGIA IN THE HOUSE OF REPRESENTATIVES MONDAY, APRIL 26, 1999

Mr. COLLINS. Mr. Speaker, today I rise to introduce legislation that will return common sense to the Internal Revenue Code by changing the depreciation period for computer equipment.

Currently, for tax purposes computer equipment must be depreciated over a five year period. Ironically, rapid technological advancements now being made in the computer industry guarantee that the average useful life of this equipment is 14-24 months. Highly competitive manufacturing businesses must continually replace computer equipment if they are to remain competitive. Although a business will often purchase a new system after 2 years, it must keep the outdated equipment on the books for 5 years.

This legislation will update the tax code to ensure that it acknowledges ongoing, rapid advancements being made in the computer industry. This measure will change the depreciation period from 5 years to 2 years, ensuring that businesses are nor penalized for making investments that ensure their ability to compete. This change will serve to promote economic growth and job creation within these competitive industries.

I strongly encourage my colleagues to join Representative BEN CARDIN, me and other original cosponsors in support of this important legislation.
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