Extension of Expiring Provisions
A number of tax provisions expired on December 31, 2016 and were not extended by the Tax Cuts and Jobs Act (Public Law 115-97) that was signed into law on December 22, 2017.
The Bipartisan Budget Act of 2018 extends the following tax provisions for the 2017 tax year. All of these provisions now expire on December 31, 2017:
• Cancellation of qualified principal residence indebtedness exclusion (IRC §108).
• Mortgage insurance premiums deduction (IRC §163).
• Tuition and fees deduction (IRC §222).
• Indian employment credit (IRC §45A).
• Railroad track maintenance credit (IRC §45G).
• Mine rescue team training credit (IRC §45N).
• Race horse two years old or younger treated as 3-year property instead of 7-year property
[IRC §168(e)(3)].
• Motor sports entertainment complexes treated as 7-year property [IRC §168(e)(3) and
§168(i)(15)].
• Indian reservation property accelerated depreciation recovery periods [IRC §168(j)].
• Mine safety equipment expense election (IRC §179E).
• Special expensing rules for certain film, television, and live theatrical productions (IRC
§181).
• Domestic production activities deduction for activities located in Puerto Rico (IRC
§199). Note: The domestic production activities deduction for all activities was repealed
by the Tax Cuts and Jobs Act for tax years beginning after December 31, 2017.
• Special rate for qualified timber gains (IRC §1201). Note: IRC section 1201 refers to
AMT for C corporations which was repealed by the Tax Cuts and Jobs Act for tax years
beginning after December 31, 2017.
• Empowerment zone tax incentives [IRC §1391(d)].
• American Samoa economic development credit [Public Law 109-432, section 119].
• Nonbusiness energy property credit (IRC §25C).
• Alternative motor vehicle credit for qualified fuel cell motor vehicles [IRC §30B(k)(1)].
• Alternative fuel vehicle refueling property credit (IRC §30C).
• Electric vehicle credit for highway-capable 2-wheeled vehicles (IRC §30D).
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• Second generation biofuel producer credit [IRC §40(b)].
• Biodiesel and renewable diesel fuels credit (IRC §40A). Note: Excise tax incentives for
biodiesel and renewable diesel fuels under IRC section 6426(c) are also extended and
modified.
• Indian coal production credit [IRC §45(e)].
• Electricity production credit or investment credit in lieu of the production credit for
non-wind renewable power facilities [IRC §45(d) and §48(a)].
• Energy efficient home credit (IRC §45L).
• Special depreciation allowance for second generation biofuel plant property [IRC §168(l)].
• Energy efficient commercial building property deduction (IRC §179D).
• Special rule for sales or dispositions to implement Federal Energy Regulatory Commission
or state electric restructuring policy [IRC §451(k)].
• Alternative fuels excise tax credit [IRC §6426(d) and §6426(e)].
Extensions beyond 2017. The following provisions are extended and modified as follows:
• The residential energy efficient property credit under IRC section 25D is extended
through December 31, 2021 and includes qualified solar electric property expenditures,
qualified solar water heating property expenditures, qualified fuel cell property expenditures,
qualified small wind energy property expenditures, and qualified geothermal
heat pump property expenditures.
• The energy credits and credit phase-outs under IRC section 48(a) are extended to periods
ending before January 1, 2022. This provision affects solar and thermal energy
property, fiber-optic solar property, qualified fuel cell property, qualified small wind
energy property, qualified microturbine property, and combined heat and power system
property.
• The oil spill liability trust fund financing rate under IRC section 4611 is extended through
December 31, 2018.
Amended returns. Taxpayers affected by these provisions who have already filed their
2017 tax return may file an amended return to take advantage of the extension of the expiration
date of these provisions.