{ "id": "IN10848", "type": "CRS Insight", "typeId": "INSIGHTS", "number": "IN10848", "active": false, "source": "EveryCRSReport.com", "versions": [ { "source": "EveryCRSReport.com", "id": 578778, "date": "2018-02-28", "retrieved": "2019-05-03T16:11:17.278314", "title": "Expired Tax Provisions and \u201cTax Extenders\u201d", "summary": "Revenue measures enacted as part of the Bipartisan Budget Act of 2018 (BBA2018, P.L. 115-123) extended a number of temporary tax provisions that had expired in 2016 or 2017. In the wake of the 2017 tax revision (P.L. 115-97), Congress has indicated an interest in evaluating expired temporary tax provisions or \u201ctax extenders.\u201d \nTable 1 provides information on temporary tax provisions and \u201ctax extenders.\u201d Specifically, the table includes (1) all provisions that expired in 2016 and 2017 and were not addressed in the 2017 tax revision (P.L. 115-97); (2) information on provisions that were extended in BBA2018, including the provisions\u2019 current scheduled expiration dates; and (3) for provisions extended in BBA2018, the cost of that extension over the 10-year budget window (FY2018 through FY2027). Before BBA2018, all provisions listed in Table 1 had expired at the end of 2016, except for the Oil Spill Liability Trust Fund excise tax, which had expired at the end of 2017.\nGenerally, BBA2018 extended provisions that had expired in 2016 for one year, through 2017. Since BBA2018 was enacted in 2018, it did not extend expired provisions such that they could provide an incentive for taxpayers in the current tax year. With the 2017 tax revision generally becoming effective in 2018, one perspective is that expired tax provisions were extended through 2017, and are now up for reevaluation under the new tax system taking effect in 2018.\nTable 1. Temporary Tax Provisions and \u201cTax Extenders\u201d\nProvision\nExtended in BBA2018?\nYear Provision Expires\nEstimated Cost of Extension in BBA2018 (billions)\n\nIndividual\n\n\n\n\nDischarge of indebtedness on principal residence excluded from gross income \nYes\n2017\n$2.4\n\nPremiums for mortgage insurance deductible as interest\nYes\n2017\n$1.1\n\nDeduction for qualified tuition and related expenses\nYes\n2017\n$0.4\n\nBusiness\n\n\n\n\nIndian employment credit\nYes\n2017\n$0.1\n\nRailroad track maintenance credit\nYes\n2017\n$0.2\n\nMine rescue team training credit\nYes\n2017\n-i-\n\nThree-year depreciation for race horses two years old or younger\nYes\n2017\n-i-\n\nSeven-year recovery period for motorsports entertainment complexes\nYes\n2017\n-i-\n\nAccelerated depreciation for business property on an Indian reservation\nYes\n2017\n$0.1\n\nElection to expense advanced mine safety equipment\nYes\n2017\n\u2014\n\nSpecial expensing rules for certain film, television, and live theatrical productionsa\nYes\n2017\n-i-\n\nDeduction for income attributable to domestic production activities in Puerto Ricob\nYes\n2017\n$0.1\n\nSpecial rate for qualified timber gainsc\nYes\n2017\n-i-\n\nEmpowerment zone tax incentivesd\nYes\n2017\n$0.3\n\nTemporary increase in limit on cover over of rum excise tax revenues (from $10.50 to $13.25 per proof gallon) to Puerto Rico and the Virgin Islands\nYes\n2021\n$0.7\n\nAmerican Samoa economic development credit\nYes\n2017\n-i-\n\nEnergy\n\n\n\n\nCredit for certain nonbusiness energy property\nYes\n2017\n$0.5\n\nCredit for residential energy property\nYes\n2021\n$3.2e\n\nCredit for qualified fuel cell motor vehicles\nYes\n2017\n-i-\n\nCredit for alternative fuel vehicle refueling property\nYes\n2017\n$0.1\n\nCredit for two-wheeled plug-in electric vehicles\nYes\n2017\n-i-\n\nSecond generation biofuel producer credit\nYes\n2017\n-i-\n\nIncentives for biodiesel and renewable diesel\nYes\n2017\n$3.3\n\nBeginning-of-construction date for non-wind production tax credit (PTC) facilitiesf\nYes\n2017\n$0.3\n\nCredit for production of Indian coal\nYes\n2017\n-i-\n\nCredit for construction of new energy efficient homes\nYes\n2017\n$0.3\n\nEnergy credit for hybrid solar lighting, geothermal heat pump, small wind, combined heat and power (CHP), fuel cell, and microturbine property\nYes\n2021\n$1.3e\n\nFive-year cost recovery for certain energy property\nYes\n2021\n$0.1\n\nSpecial depreciation allowance for second generation biofuel plant property\nYes\n2017\n-i-\n\nEnergy efficient commercial buildings deduction\nYes\n2017\n$0.1\n\nSpecial rule for sales or dispositions to implement Federal Energy Regulatory Commission (\u201cFERC\u201d) or State electric restructuring policy\nYes\n2017\n\u2014\n\nIncentives for alternative fuel and alternative fuel mixtures\nYes\n2017\n$0.6\n\nOil Spill Liability Trust Fund financing rate\nYes\n2018\nn/a\n\nSource: Joint Committee on Taxation, List of Expiring Federal Tax Provisions 2016-2027 (JCX-1-18), January 9, 2018; and Joint Committee on Taxation, Estimated Budget Effects of the Revenue Provisions Contained in the \u201cBipartisan Budget Act of 2018,\u201d (JCX-4-18), February 8, 2018.\nNotes: An \u201c-i-\u201d indicates a cost of less than $50 million. An \u201c\u2014\u201c indicates no revenue cost. An \u201cn/a\u201d indicates no revenue effect from extending the provision.\nFilm, television, and live theatrical productions are eligible for additional first-year depreciation if placed in service after September 27, 2017, and before January 1, 2027. \nThe domestic production activities deduction (Section 199) is repealed after 2017. \nThe special rate for qualified timber gains is provided in Internal Revenue Code Section 1201(b). Section 1201 is repealed after December 31, 2017. \nEmpowerment zone tax incentives include designation of an empowerment zone and of additional empowerment zones; empowerment zone tax-exempt bonds; empowerment zone employment credit; increased expensing under Section 179; and nonrecognition of gain on rollovers of empowerment zone investments. \nThe provision was extended through 2021 with a phaseout in 2020 and 2021.\nBeginning-of-construction date for wind is December 31, 2019. \nIn addition to extending expired provisions as noted in Table 1, the BBA2018 modified the advanced nuclear production tax credit and expanded the tax credit for carbon dioxide sequestration. The legislation also includes tax relief relating to certain disasters and several other miscellaneous revenue measures. \nAdditional background information on extenders generally and descriptions of expired provisions can be found in the following CRS products:\nCRS Report R44677, Tax Provisions that Expired in 2016 (\u201cTax Extenders\u201d), by Molly F. Sherlock; \nCRS Report R44925, Recently Expired Individual Tax Provisions (\u201cTax Extenders\u201d): In Brief, coordinated by Molly F. Sherlock;\nCRS Report R44930, Business Tax Provisions that Expired in 2016 (\u201cTax Extenders\u201d), coordinated by Molly F. Sherlock; and\nCRS Report R44990, Energy Tax Provisions That Expired in 2016 (\u201cTax Extenders\u201d), by Molly F. Sherlock, Donald J. Marples, and Margot L. Crandall-Hollick.", "type": "CRS Insight", "typeId": "INSIGHTS", "active": false, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "https://www.crs.gov/Reports/IN10848", "sha1": "6dc4d047a87db96a1e5598546b6d198fdf5e80ac", "filename": "files/20180228_IN10848_6dc4d047a87db96a1e5598546b6d198fdf5e80ac.html", "images": {} } ], "topics": [ { "source": "IBCList", "id": 4799, "name": "Individual Tax" }, { "source": "IBCList", "id": 4804, "name": "Business & Corporate Taxation" }, { "source": "IBCList", "id": 4935, "name": "Energy Tax" } ] }, { "source": "EveryCRSReport.com", "id": 577617, "date": "2018-01-16", "retrieved": "2018-01-18T14:10:16.387544", "title": "Expired Tax Provisions and \u201cTax Extenders\u201d", "summary": "A number of temporary tax provisions expired at the end of 2016. Although some temporary or expired provisions were addressed in the 2017 tax revision (P.L. 115-97), most of the provisions that expired in 2016 have not been extended beyond their 2016 expiration date. Some have suggested that a tax extenders bill enacted early in 2018 could retroactively extend expired tax provisions. Alternatively, another policy option is to allow expired tax provisions to remain expired.\nTable 1 provides information on expired tax provisions and \u201ctax extenders.\u201d Specifically, the table includes (1) all provisions that expired in 2016 and 2017 and were not addressed in the 2017 tax revision (P.L. 115-97); (2) provisions that would be extended in the Tax Extender Act of 2017 (S. 2256); and (3) for provisions that were extended for two years, retroactive for 2015 and through 2016, in the Consolidated Appropriations Act, 2016 (P.L. 114-113), the cost of that extension over the 10-year budget window (fiscal years 2016 through 2025). However, with the enactment of P.L. 115-97, the current law tax baseline has substantively changed. Thus, past cost estimates may not necessarily be indicative of the cost of future extensions. \nTable 1. Expired Tax Provisions and \u201cTax Extenders\u201d\nProvision\nYear Provision Expired\nWould Be Extended in \nS. 2256?Estimated Cost of Extension in P.L. 114-113 (billions)\nIndividual\n\n\n\nDischarge of indebtedness on principal residence excluded from gross income 2016YES$5.1\nPremiums for mortgage insurance deductible as interest\n2016\nYES\n$2.3\n\nDeduction for qualified tuition and related expenses\n2016\nYES\n$0.6\n\nBusiness\n\n\n\n\nIndian employment credit\n2016\nYes\n$0.1\n\nRailroad track maintenance credit\n2016\nYes\n$0.4\n\nMine rescue team training credit\n2016\nYes\n-i-\n\nThree-year depreciation for race horses two years old or younger\n2016\nYes\n\u2014\n\nSeven-year recovery period for motorsports entertainment complexes\n2016\nYes\n$0.1\n\nAccelerated depreciation for business property on an Indian reservation\n2016\nYes\n$0.2\n\nElection to expense advanced mine safety equipment\n2016\nYes\n\u2014\n\nSpecial expensing rules for certain film, television, and live theatrical productionsa\n2016\nYes\n-i-\n\nDeduction for income attributable to domestic production activities in Puerto Ricob\n2016\nYes\n$0.2\n\nSpecial rate for qualified timber gainsc\n2016\nYes\nn/ad\n\nEmpowerment zone tax incentivese\n2016\nYes\n$0.5\n\nTemporary increase in limit on cover over of rum excise tax revenues (from $10.50 to $13.25 per proof gallon) to Puerto Rico and the Virgin Islands\n2016\nYes\n$0.3\n\nAmerican Samoa economic development credit\n2016\nYes\n-i-\n\nEnergy\n\n\n\n\nCredit for certain nonbusiness energy property\n2016\nYes\n$1.3\n\nCredit for residential energy propertyf\n2016\nYes\nn/ag\n\nCredit for qualified fuel cell motor vehicles\n2016\nYes\n-i-\n\nCredit for alternative fuel vehicle refueling property\n2016\nYes\n$0.1\n\nCredit for two-wheeled plug-in electric vehicles\n2016\nYes\n-i-\n\nSecond generation biofuel producer credit\n2016\nYes\n-i-\n\nIncentives for biodiesel and renewable diesel\n2016\nYes\n$2.6\n\nBeginning-of-construction date for non-wind production tax credit (PTC) facilitiesh\n2016\nYes\n$1.4\n\nCredit for production of Indian coal\n2016\nYes\n$0.1\n\nCredit for construction of new energy efficient homes\n2016\nYes\n$0.8\n\nEnergy credit for hybrid solar lighting, geothermal heat pump, small wind, combined heat and power (CHP), fuel cell, and microturbine property\n2016\nYes\nn/ag\n\nFive-year cost recovery for certain energy property\n2016\nNoi\nn/ag\n\nSpecial depreciation allowance for second generation biofuel plant property\n2016\nYes\n-i-\n\nEnergy efficient commercial buildings deduction\n2016\nYes\n$0.3\n\nSpecial rule for sales or dispositions to implement Federal Energy Regulatory Commission (\u201cFERC\u201d) or State electric restructuring policy\n2016\nYes\n\u2014\n\nIncentives for alternative fuel and alternative fuel mixtures\n2016\nYes\n$0.9\n\nOil Spill Liability Trust Fund financing rate\n2017\nYes\nn/ag\n\nSource: Joint Committee on Taxation, List of Expiring Federal Tax Provisions 2016-2027 (JCX-1-18), January 9, 2018; the Tax Extender Act of 2017 (S. 2256); and Joint Committee on Taxation, General Explanation of Tax Legislation Enacted in 2015 (JCS-1-16), March 14, 2016.\nNotes: S. 2256 also includes an extension of Qualified Zone Academy Bond authority. However, the authority to issue tax-credit bonds, like the Qualified Zone Academy Bonds, was repealed in P.L. 115-97. An \u201c-i-\u201d indicates a cost of less than $50 million. An \u201c\u2014\u201c indicates no revenue cost. \nFilm, television, and live theatrical productions are eligible for additional first-year depreciation if placed in service after September 27, 2017, and before January 1, 2027. \nThe domestic production activities deduction (Section 199) is repealed after 2017. \nThe special rate for qualified timber gains is provided in Internal Revenue Code Section 1201(b). Section 1201 is repealed after December 31, 2017. \nThis special rate for corporate timber gains, enacted for one year in P.L. 114-113, had an estimated revenue cost of $35 million. \nEmpowerment zone tax incentives include designation of an empowerment zone and of additional empowerment zones; empowerment zone tax-exempt bonds; empowerment zone employment credit; increased expensing under Section 179; and nonrecognition of gain on rollovers of empowerment zone investments. \nTax credits for residential solar energy property are available until December 31, 2021. \nThe provision had not expired and thus was not extended in P.L. 114-113. \nBeginning-of-construction date for wind is December 31, 2019. \nP.L. 115-97 generally provides full and immediate expensing of capital investments placed in service after September 27, 2017, and before January 1, 2023 (with the bonus depreciation amount phased down after this date). Public utility property is generally excluded. \nIn addition to extending expired provisions as noted in Table 1, the Tax Extender Act of 2017 (S. 2256) proposes to modify the advanced nuclear production tax credit and expand the tax credit for carbon dioxide sequestration. \nAdditional background information on extenders generally and descriptions of expired provisions can be found in the following CRS products:\nCRS Report R44677, Tax Provisions that Expired in 2016 (\u201cTax Extenders\u201d), by Molly F. Sherlock; \nCRS Report R44925, Recently Expired Individual Tax Provisions (\u201cTax Extenders\u201d): In Brief, coordinated by Molly F. Sherlock;\nCRS Report R44930, Business Tax Provisions that Expired in 2016 (\u201cTax Extenders\u201d), coordinated by Molly F. Sherlock; and\nCRS Report R44990, Energy Tax Provisions That Expired in 2016 (\u201cTax Extenders\u201d), by Molly F. Sherlock, Donald J. Marples, and Margot L. Crandall-Hollick.", "type": "CRS Insight", "typeId": "INSIGHTS", "active": true, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "http://www.crs.gov/Reports/IN10848", "sha1": "b808db8ed440a6a0b852621748ab55ccbb96b22e", "filename": "files/20180116_IN10848_b808db8ed440a6a0b852621748ab55ccbb96b22e.html", "images": {} } ], "topics": [ { "source": "IBCList", "id": 4799, "name": "Individual Tax" }, { "source": "IBCList", "id": 4804, "name": "Business & Corporate Taxation" }, { "source": "IBCList", "id": 4935, "name": "Energy Tax" } ] } ], "topics": [ "CRS Insights" ] }