Governor Deval Patrick's Budget Recommendation - House 1 Fiscal Year 2014

2.306 -Deduction for Excess First-Year Depreciation

Item DescriptionFY2012 FY2013 FY2014
2.306 Deduction for Excess First-Year Depreciation
Taxpayers may elect to expense certain business assets purchased during the taxable year. American Taxpayer Relief Act of 2012 (enacted January 1, 2013) increased the benefits, making changes to IRC sec. 179. For tax year 2012, Massachusetts adopts the increased federal amounts provided by IRC sec. 179. Hence, the total deduction cannot exceed $500,000; for taxpayers whose investment in eligible assets exceeds $2,000,000 in the year, the $500,000 ceiling is reduced by $1 for each dollar of investment above $2,000,000. Any remaining cost may be depreciated according to MACRS as described in item 2.305. The immediate deduction constitutes a tax expenditure, resulting in a deferral of tax or an interest-free loan.

Origin:  IRC, S. 179
Estimate:  $21.3
8.2 2.3 21.3


IRCFederal Internal Revenue Code (26 U.S.C.)
M.G.L. Massachusetts General Laws
U.S.C United States Code
ESTIMATES All estimates are in $ millions.

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