Wyden to Unveil Draft of Simplified Depreciation Rules

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April 25 — A draft proposal on new depreciation rules is expected from Sen. Ron Wyden (D-Ore.) as early as April 26.

Like some past plans to revamp depreciation schedules, it is largely focused on simplification and record keeping, according to lobbyists and a tax practitioner familiar with some details.

One of the sources compared Wyden's effort to a draft issued two and a half years ago by former Senate Finance Committee Chairman Max Baucus (D-Mont.), in terms of general substance. At the time, Baucus pitched his proposal as a way to make it easier for businesses to recoup their investment costs.

But the two plans are said to differ on revenue.

“It's pretty much a redo of the former Baucus proposal only this time drafted to be revenue neutral as opposed to raising revenue,” said one of the lobbyists familiar with the Wyden package. “So essentially, it would be drafted purely as simplification reform instead of also being an offset for tax reform.”


That simplicity is central to Wyden's pitch.

“If you are a leasing company with thousands and thousands of assets you must keep thousands and thousands of records. Now if the property is all in one pool, you keep one number instead of thousands of numbers,” the practitioner said, adding that although Wyden's idea is being proposed on a stand-alone basis, it could later get attached to a wider tax overhaul plan.

Another source described Wyden's proposal as a “mass asset depreciation” plan.

The Baucus discussion draft on accounting and cost recovery would have generated about $700 billion over a decade that could have been used to lower the corporate tax rate (226 DTR GG-1, 11/22/13).

It would have slowed depreciation in general, as would have components of the wider-reaching tax overhaul legislation from former House Ways and Means Committee chairman Dave Camp (R-Mich.).

Wyden and his staff have been mum on details.

To contact the reporter on this story: Aaron E. Lorenzo in Washington at aaron@bna.com and Kaustuv Basu in Washington at kbasu@bna.com
To contact the editor responsible for this story: Brett Ferguson at bferguson@bna.com