Senate Bill 32 amends Tennessee Code Annotated, specifically Section 67-4-2006(a)(12), to update the regulations regarding the deduction for bonus depreciation for excise tax purposes. The bill introduces new provisions for assets purchased between January 1, 2023, and January 1, 2026, allowing taxpayers to apply Section 168 of the Internal Revenue Code as it stands under the Tax Cuts and Jobs Act of 2017. For assets acquired on or after January 1, 2026, taxpayers will have the option to deduct 40% of the cost of depreciable assets in the year of purchase.

Additionally, if the federal government decides to increase the bonus depreciation percentage beyond 40% after January 1, 2026, taxpayers will be permitted to adopt the higher percentage for their deductions. The bill ensures that the application of Section 168 remains consistent with the federal tax law as amended. This act will take effect upon becoming law, emphasizing its immediate relevance to public welfare.

Statutes affected:
Introduced: 67-4-2006(a)(12), 67-4-2006