H.R. 4718, a bill to amend the Internal Revenue Code of 1986 to modify and make permanent bonus depreciation

Cost Estimate
June 5, 2014

As ordered reported by the House Committee on Ways and Means on May 29, 2014

H.R. 4718 would amend the Internal Revenue Code to permanently provide an additional first-year depreciation deduction of 50 percent of the adjusted basis of qualified property, effective January 1, 2014. Under current law that additional deduction expired after December 31, 2013. H.R. 4718 would also expand the definition of qualified property to include certain retail improvement property and certain trees and vines bearing nuts or fruits. It would also expand and make permanent recently expired provisions that allowed corporations to claim additional credits against the alternative minimum tax instead of claiming the additional first-year depreciation deduction.

The staff of the Joint Committee on Taxation (JCT) estimates that enacting H.R. 4718 would reduce revenues, thus increasing federal budget deficits, by about $287 billion over the 2014-2024 period.

The Statutory Pay-As-You-Go Act of 2010 establishes budget-reporting and enforcement procedures for legislation affecting direct spending and revenues. Enacting H.R. 4718 would result in revenue losses in each year beginning in 2014.