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Treasury, IRS announce proposed changes to depreciation deduction

August 14, 2018 Washington — The U.S. Department of the Treasury and Internal Revenue Service announced Aug. 3 proposed regulations on increasing and expanding the first-year depreciation deduction for qualified property.  

According to the agencies, the benefit expands opportunities for small and midsized businesses — including dental practices — to "expense equipment purchases and make capital investments in their companies," according to a Treasury Department news release.

Following its passage in 2017, the Tax Cuts and Jobs Act increased the first-year depreciation deduction from 50 to 100 percent for qualified properties acquired.

The deduction applies retroactively to qualified property acquired and placed in service after Sept. 27, 2017.  The first-year allowance is 100 percent and is then decreased by 20 percent annually for qualified property placed in service after Dec. 31, 2022. The proposed change also extends the "placed-in-service date" from Jan. 1, 2021, to Jan. 1, 2027.

Read the proposed rule here.