[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 9069 Introduced in House (IH)]
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118th CONGRESS
2d Session
H. R. 9069
To amend the Internal Revenue Code of 1986 to modify the depreciation
of nonresidential real property and residential rental property.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 18, 2024
Mr. Hern (for himself, Mr. Pfluger, Mr. Smith of Nebraska, Mrs. Miller
of West Virginia, Ms. Van Duyne, and Ms. Tenney) introduced the
following bill; which was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to modify the depreciation
of nonresidential real property and residential rental property.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Renewing Investment in American
Workers and Supply Chains Act''.
SEC. 2. MODIFICATION OF DEPRECIATION OF NONRESIDENTIAL REAL PROPERTY
AND RESIDENTIAL RENTAL PROPERTY.
(a) 20-Year Recovery Period.--
(1) In general.--Section 168(e)(3)(F) of the Internal
Revenue Code of 1986 is amended to read as follows:
``(F) 20-year property.--The term `20-year
property' means--
``(i) initial clearing and grading land
improvements with respect to any electric
utility transmission and distribution plant,
``(ii) any nonresidential real property,
and
``(iii) any residential rental property.''.
(2) Bonus depreciation not applicable.--Section
168(k)(2)(A)(i)(I) of such Code is amended by inserting
``(other than nonresidential real property and residential
rental property)'' before the comma at the end.
(3) Conforming amendment.--The table contained in section
168(c) of such Code is amended--
(A) by striking the row relating to residential
rental property, and
(B) by striking the row relating to nonresidential
real property.
(b) Adjustment of Deduction To Provide Neutral Cost Recovery.--
Section 168 of such Code is amended by adding at the end the following
new subsection:
``(n) Neutral Cost Recovery for Nonresidential Real Property and
Residential Rental Property.--
``(1) In general.--The deduction otherwise provided under
section 167(a) with respect to nonresidential real property and
residential rental property for any taxable year shall be equal
to the product of such amount (determined without regard to
this subsection) multiplied by the applicable neutral cost
recovery ratio with respect to such property for such taxable
year.
``(2) Neutral cost recovery ratio.--For purposes of
paragraph (1), the term `applicable neutral cost recovery
ratio' means, with respect to any property for any taxable
year, the product (not less than 1 and rounded to the nearest
0.001) of--
``(A) the quotient of--
``(i) the gross domestic product deflator
(as determined by the Bureau of Economic
Analysis) for the calendar quarter ending in
such taxable year which corresponds to the
calendar quarter during which such property was
placed in service by the taxpayer, divided by
``(ii) the gross domestic product deflator
(as determined by the Bureau of Economic
Analysis) for the calendar quarter during which
such property was placed in service by the
taxpayer, multiplied by
``(B) 1.03 to the nth power, where `n' is the
number of full years in the period beginning on the 1st
day of the calendar quarter during which such property
was placed in service by the taxpayer and ending on the
day before the beginning of the corresponding calendar
quarter ending during such taxable year.
``(3) Application to property placed in service before date
of enactment.--In the case of nonresidential real property or
residential rental property which is placed in service before
the date of enactment of this subsection, subparagraphs (A)(i),
(A)(ii), and (B) of paragraph (2) shall each be applied by
substituting `calendar quarter which includes the date of
enactment of this subsection' for `calendar quarter during
which such property was placed in service by the taxpayer'.
``(4) Additional deduction not to affect basis or
recapture.--
``(A) In general.--The additional amount determined
under this section by reason of this subsection shall
not be taken into account in determining the adjusted
basis of any applicable property or of any interest in
a pass-thru entity which holds such property and shall
not be treated as a deduction for depreciation for
purposes of sections 1245 and 1250.
``(B) Pass-thru entity defined.--For purposes of
subparagraph (A), the term `pass-thru entity' means--
``(i) a regulated investment company,
``(ii) a real estate investment trust,
``(iii) an S corporation,
``(iv) a partnership,
``(v) an estate or trust, and
``(vi) a common trust fund.''.
(c) Effective Dates.--
(1) 20-year recovery period.--The amendments made by
subsection (a) shall apply to property placed in service after
the date of the enactment of this Act, in taxable years ending
after such date.
(2) Neutral cost recovery.--The amendments made by
subsection (b) shall apply to taxable years ending after the
date of the enactment of this Act.
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