As someone who grew up in the 80’s, it’s really sobering to think of what year it is. Back then, the “Year 2000” seemed soooo far away. Yet, we’re now in the second decade of the millennium. Time certainly marches on.

But this isn’t a reflective post – instead, I’ll repeat what I did last year and give you a few predictions:

• Section 179 was given a nice boost for 2011, meaning we probably won’t hear much about it from the government. Which is fine – leave it alone (I’ll continue to trumpet Section 179 here, as I really like it, and think it’s a great business incentive.)

• The Falcons will win the Super Bowl. The Red Sox will win the World Series, the Orlando Magic will win the NBA title, and I have no idea who will win the Stanley Cup, because I do not follow hockey that much (can I say the Red Wings here?)

• We’ll see some bones thrown to businesses from congress, because really, we need our own stimulus. Perhaps the ITC (Investment Tax Credit) will make a comeback. That, combined with Section 179 and a solid equipment financing partner (ahem) could mean 2011 is a better year than you are currently foreseeing.

• However, in the end, I feel 2011 will continue the “slightly rising stagnation” that was 2010, and by the third quarter, we’ll be pretty complacent in what are slightly raised numbers. In other words, we won’t see many huge dips or spikes in economic activity. They’ll call it a recovery, but really, it’s just the new normal.

• On a personal note, Mr. and Mrs. Fletch will enjoy their new pool quite a bit.

Happy New Year, everyone!!

• I’d like to give thanks to the government for realizing that small businesses needed help, and increasing Section 179. It’s definitely a step in the right direction. But it can go further. As I pointed out in another post, bringing back the ITC (the Investment Tax Credit) for equipment and software purchases would be great. Maybe 2011 brings this around.

• I’d like to give thanks to business owners for not grabbing pitchforks and torches and revolting against the government. Yes, I know I just gave them props for the Section 179 boost, but seriously, it happened in the year’s third quarter. So it took them a LONG time to realize “hey, maybe things aren’t as good as we’ve been saying they are.”

• Let’s give thanks again to business owners for weathering the storm that was 2010. Whew, that was tough, huh?

• I’d like to give thanks to Webster’s dictionary for reminding me that “recovery” still means what I thought it meant. Because I have to say, it annoyed me slightly to constantly hear the word “recovery” when in fact, we were really pretty stagnant. In this day and age, “recovery” must mean “well, at least it’s not getting any WORSE.” That works in the hospital (“He stopped bleeding – he’s on the road to recovery!”), but not in the economy.

• I’d like to thank clients who came to my company for equipment financing. We worked with as many people as we could to get them financed, and as the year winds down, I can say that I’m satisfied. It could have been a better year, of course, but we’re all saying that. And like I have mentioned earlier this year, we’re all still here. And that counts for something.

• I’d like to thank Mrs. Fletch for putting up with me. I’m pretty tied to my work, because I like what I do, and she understands that (although she understood it even better when the pool groundbreaking occurred!)

• I’d like to thank my readers. While I write this blog for me (I’m one of those guys who always jotted down his thoughts), it’s really nothing but blather without readers (although some would say it’s blather anyway!) So thanks.

My Section 179 Addendum

This is an addendum I’ll be adding to my posts for the rest of the year. That’s because it’s getting later in the year, and Section 179 for 2010 ends soon. If you want that new piece of equipment, and also want to take advantage of the new, higher limits, NOW is the time.

So with that in mind, this post is a shout out to an old friend that I feel would stimulate the business economy quite a bit. And that’s bringing back the ITC, or “Investment Tax Credit” for equipment and software purchases. According to me, this has a few things going for it:

1)     Tax cuts are needed to spur the economy. Trust me, the biggest fear of small to medium sized businesses is more taxes, and more red tape. That’s what’s causing them to hold their money now. Eliminate that threat, and you’ll see more spending.

2)     Directly relating these tax cuts to equipment purchases will help everyone involved. The companies buying the new equipment, the companies making the new equipment, the companies financing the new equipment (hello) and the employees who will be needed to use the new equipment. Everyone wins.

3)     In terms of politics, this is a no-brainer. If there was ever a bipartisan issue, this is it. Introduced by Kennedy in 1962, the ITC was repealed during the Johnson Administration, brought back under Nixon, repealed by Reagan, etc etc. It’s “non-branded”, so to say.

And it’ll help… here’s what was said about it in 1962: Congress agreed “to encourage modernization and expansion of the Nation’s productive facilities and thereby improve the economic potential of the country, with resultant increase in job opportunities and betterment of our competitive position in the world economy” [U.S. Congress, Senate, Committee on Finance, 1962, p. 11].

Over time, the ITC has ranged from 5% to 7% to 10% of the equipment and software cost off income tax liability. That’s a straight credit, folks – businesses like that.

I’m not an economist (as my checkbook wielding wife keeps reminding me), but I think this has a lot of merit. Bring back the ITC.

My Section 179 Addendum (again):

This is an addendum I’ll be adding to some posts. But it’s getting later in the year, and Section 179 as we know it may not be around much longer. If you want that new piece of equipment, NOW is the time. Maybe next year, we’ll see Section 179 and the ITC – that would be nice.