Business Tax Provisions Expiring in 2020, 2021, and 2022 (“Tax Extenders”)

Summary

Thirteen temporary business tax provisions are scheduled to expire at the end of 2020. Four other temporary business tax provisions are scheduled to expire in 2021 or 2022. In the past, Congress has regularly acted to extend expired or expiring temporary tax provisions. Collectively, these temporary tax provisions are often referred to as “tax extenders.”

This report briefly summarizes and discusses the economic impact of the 17 business-related tax provisions that are scheduled to expire in 2020, 2021, or 2022. The provisions discussed in this report are listed below, grouped by type and scheduled year of expiration.

The following special business investment (cost recovery) provisions are scheduled to expire in 2020:

special expensing rules for certain film, television, and live theatrical productions;

seven-year recovery period for motorsports entertainment complexes;

three-year depreciation for race horses two years or younger; and

accelerated depreciation for business property on an Indian reservation.

The following economic development provisions are scheduled to expire in 2020:

empowerment zone tax incentives;

American Samoa economic development credit; and

new markets tax credit.

The following other business-related provisions are scheduled to expire in 2020:

Indian employment tax credit;

mine rescue team training credit;

employer tax credit for paid family and medical leave;

work opportunity tax credit;

look-through treatment of payments between related controlled foreign corporations; and

provisions modifying excise taxes on wine, beer, and distilled spirits.

The following provisions are scheduled to expire in 2021 or 2022:

12.5% increase in low-income housing tax credit (LIHTC) authority;

computation of adjusted taxable income without regard to any deduction allowable for depreciation, amortization, or depletion;

the rum cover over; and

credit for certain expenditures for maintaining railroad tracks.

The 13 temporary business-related tax provisions scheduled to expire at the end of 2020 were most recently extended by the Further Consolidated Appropriations Act of 2020 (P.L. 116-94). Of these 13 provisions, 8 had expired in 2017 and were extended retroactively and 5 were scheduled to expire in 2019. Past tax extenders legislation had extended 11 of these 13 provisions. The other two provisions, both of which were scheduled to expire in 2019, were added to the tax code as part of the 2017 tax revision (P.L. 115-97). Four other business-related provisions will expire in 2021 or 2022.

This report does not include provisions that in the past have been classified as individual or energy-related. See CRS Report R46243, Individual Tax Provisions (“Tax Extenders”) Expiring in 2020: In Brief, coordinated by Molly F. Sherlock; and CRS Report R44990, Energy Tax Provisions That Expired in 2017 (“Tax Extenders”), by Molly F. Sherlock, Donald J. Marples, and Margot L. Crandall-Hollick. For a general overview of tax extenders, see CRS Report R45347, Tax Provisions That Expired in 2017 (“Tax Extenders”), by Molly F. Sherlock.