April 23, 2020

2020 – 04/20 – New COVID-19 law makes favorable changes to “qualified improvement property”





A law providing relief due to the coronavirus (COVID-19) crisis contains a valuable change in the tax rules for improvements to interior parts of nonresidential buildings. You may recall that under the Tax Cuts and Jobs Act, any qualified improvement property (QIP) placed in service after Dec. 31, 2017 wasn’t eligible for 100% bonus depreciation. The cost had to be deducted over 39 years rather than entirely in the year the QIP was placed in service. This was due to a drafting error by Congress. But the new CARES Act now allows most businesses to claim 100% bonus depreciation for QIP as long as requirements are met. The correction is retroactive to QIP placed in service after Dec. 31, 2017.

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