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Percentage Depletion Deduction Preserved in House Tax Bill

Posted By Mark Ellis, Thursday, November 2, 2017

The good news is today the House Ways and Means Committee released its tax bill – H.R. 1, The Tax Cuts and Jobs Act.  The bill is the House version of comprehensive tax reform.  The House Ways and Means Committee will markup the bill beginning on Monday, November 6, at 12:00 p.m.

The great news is that the percentage depletion tax deduction remains unchanged as current law -- no repeal or modification of the current percentage depletion tax deduction is included in the House bill.  This is but one of the many steps in the ongoing tax reform legislative process, but it is a great first step.         

Some other House bill highlights that may be of interest to you and your company:

  1. The bill lowers the corporate tax rate to 20% – down from 35%;
  2. The bill reduces the tax rate on the business income of Main Street job creators to no more than 25%;
  3. The bill establishes strong safeguards to distinguish between individual wage income and “pass-through” business income;
  4. The bill allows businesses to immediately write-off the full cost of new equipment to improve operations and enhance the skills of their workers (i.e., full expensing); and
  5. The bill repeals the alternative minimum tax.

The Senate Finance Committee is expected to release its version of tax reform legislation sometime next week.

We will provide more information as the tax reform process evolves in Washington.  Many thanks to IMA-NA member companies for your engagement and feedback during the legislative process!

A copy of H.R. 1 is attached.

A section-by-section summary of H.R. 1 also is attached.   

Download File (PDF)

 Attached Files:

Tags:  H.R. 1  percentage depletion deduction  tax reform legislation 

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