✨ What’s new

100% bonus extension on the horizon? As most of you know, bonus is currently phasing down by 20% each year from 100% in 2022 to 0% in 2027 😢. Rejoice bonus depreciation lovers (maybe?) as the House of Representatives approved a huge tax bill last night which included an extension of 100% bonus for 2023 thru 2025.

The final vote tally was 357-70, so the legislation has broad bipartisan support. But there is still a long way to go. The bill now moves on to the Senate, where it has support, but is competing against many other priorities. This article provides a good explanation of the current situation.

What would the bill mean for you? If passed as currently written, 100% bonus depreciation would be reinstated retroactively to 1/1/2023 and would expire 12/31/2025. Properties previously acquired and placed in service during 2023 would be eligible for 100% bonus (instead of the current 80% bonus). 

What else is in the bill?

• 20% bonus for assets placed in service during 2026

• No bonus starting in 2027

• Domestic R&D expenditures would be fully deductible for 2022 thru 2025 

• Provide a temporary increase in Section 179 expensing.

• The bill also includes an enhanced child tax credit, Taiwan double taxation relief, an expanded low-income housing tax credit, and changes to Form 1099 information reporting.

 🐦️ In case you missed it on Twitter

• Cost seg example comparing 100% vs. 80% vs. 60% bonus

• Physical depreciation vs. Tax depreciation

 📤️ Referrals

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