|August 8, 2014|
Previously published on August 5, 2014
On July 11, 2014, the House of Representatives passed a bill to renew bonus depreciation and to make the provision permanent. Bonus depreciation is one of several expired provisions that House Ways and Means Committee Chairman Dave Camp (R-Mich.) has made sought to make permanent.
Bonus depreciation allows businesses to immediately deduct 50 percent of qualified purchased property and was one of the tax provisions that expired at the end of 2013. The bill passed by the House makes a number of changes to the bonus depreciation provision such as expanding the definition of qualified property to include owner-occupied retail stores and lifting certain restrictions to allow for more unused corporate alternative minimum tax credits to be used for capital investments.
Other permanent extensions of expired provisions, or “tax extenders” bills, which have passed the House include the five-year built-in gains recognition period for S corporations and the research tax credit. Chairman Camp’s approach to tax extenders—dealing with fewer, select provisions and making them permanent—breaks from what many saw as standard operating procedure in Congress. Historically, a one- or two-year extension of all the expiring tax provisions was packaged a single bill (or attached to a larger bill).
Read coverage in Tax Notes.