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Tes' Take: Tax Cuts & Jobs Act - Unintended Consequences

Tes Macaraya is a partner and head of tax at Martini Iosue & Akpovi

As we continue to review and analyze the new tax law, we have noticed unintended consequences. One of these is in the area of depreciation. Lawmakers meant to consolidate the three categories of renovation – qualified leasehold improvement, qualified restaurant property and qualified retail improvement property into one category called qualified improvement property. However, the final bill inadvertently omits the provision which would have given the qualified improvement property a 15 year recovery period. The result is this type of property has a 39-year recovery period and is not eligible for bonus depreciation or Section 179 expense.

Follow this link for an interesting read on how this affects the restaurant and retail businesses.

Will this be part of the Technical Correction bill that is being worked on right now?

For more information please contact me on (818) 789 1179 or email me at

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