Sunday, September 23rd, 2018

GO Zone Extension Sought By Senators of Mississippi

Mississippi State Republican senators Thad Cochran and Roger Wicker, in a bold effort to encourage building growth after hurricane Katrina, have introduced legislation towards that end.

This new bill would allow an extension of the soon to expire Gulf Opportunity Zone bonus depreciation tax by two years. The new expiration date would be December 31, 2011 instead of 2009, which is less than two months away as of this writing.

Senator Wicker, the author of the bill stated in a news release that Louisiana Democratic Senator Mary Landrieu and Republican Senator David Vitter had also signed on from the outset as cosponsors of the new measure.

In 2005 a tax incentive called the GO Zone Act was established that was the equivalent of 50% of the cost of property that qualified for the year it was put in service and was also taxable.

Areas that would benefit from the extended bonus depreciation incentive of the new bill are those in Mississippi and Louisiana, which suffered the most damage from Katrina; including the counties of Hancock, Jackson, Pearl River and Stone of Mississippi.

In Wicker’s news release he stated, “The bonus depreciation incentive has had a substantial impact on Gulf Coast rebuilding by helping fuel private investment in commercial and affordable housing construction.” He added, “Problems with flood maps and other infrastructure delays have prohibited many projects from being able to take advantage of the bonus depreciation incentive.”

Senator Cochran stated that in order for progress to continue to be made, the two-year extension was necessary. Another staunch supporter of the bill, Brian Sanderson, a member of the Gulf cost Business Council referred to the GO Zone as “one of the most important tools” develop by Congress after the destruction of Hurricane Katrina.

Investors and developers have taken advantage of the GO Zone’s depreciation deduction for rebuilding efforts spanning the Gulf Coast. A variety of building structures have been included in the Incentive. Everything from apartment complexes to hotels and factories to retail stores have been erected using this bonus incentive.

Senator Landrieu introduced two bills that are also being cosponsored by Senators Cocnran and Wicker. These would allow GO Zone tax credits to be extended for low-income housing projects and the restoration of historical buildings.