Paul L. Caron

Friday, January 8, 2010

List of Tax Provisions That Expired Dec. 31, 2009

From the Journal of Accountancy:

Expired Taxes

§§ 2001-2209 estate tax.

§§ 2601-2663 generation-skipiing tax.

Expired Tax Credits

§ 30B alternative motor vehicle credit for hybrids weighing more than 8,500 pounds;

§ 40A credit for biodiesel and renewable diesel fuel;

§ 41 credit for research and experimentation;

§ 45A Indian employment tax credit;

§ 45D new markets tax credit;

§ 45G credit for certain railroad track expenditures; 

§ 45N mine rescue team training credit;

§ 45P employer wage credit for active-duty members of the uniformed services;

§ 936 & 27(b) possession tax credit with respect to American Samoa;

§ 1397E credit for holders of qualified zone academy bonds; and

§ 1400C credit for first-time District of Columbia homebuyers.

Expired Deductions

§ 62(a)(2)(D) deduction for elementary and secondary schoolteachers;

§ 63(c)(1) additional standard deduction for state and local real property taxes;

§ 164 state and local sales tax deduction;

§ 165(h) deduction for personal casualty losses in federally declared disasters;

§ 168(e)(3)(E)(iv) 15-year straight-line cost recovery for qualified leasehold improvements;

§ 168(e)(3)(E)(v) 15-year straight-line cost recovery for qualified restaurant improvements;

§ 168(j) accelerated depreciation for property on Indian reservations;

§ 168(i)(15)(D) seven-year cost recovery period for motor sports entertainment complexes;

§ 168(n) expensing and special depreciation allowance for qualified disaster assistance property;

§ 170(b)(1)(E)(vi) contributions of capital gain real property made for conservation purposes;

§ 170(e)(3)(C)(iv)  enhanced deduction for contributions of food inventory;

§ 170(e)(3)(D)(iv)  enhanced deduction for contributions of book inventory to public schools;

§ 170(e)(6)(G) enhanced deduction for corporate contributions of computer equipment for educational purposes;

§ 179E(g) election to expense advanced mine safety equipment;

§ 181(f) expensing treatment for certain film and television productions;

§ 198(h) expensing of environmental remediation costs;

§ 199(d)(8) deduction for income attributable to domestic production activities in Puerto Rico; and

§ 222 deduction for tuition and related expenses.

Other Provisions

§ 172(j) carryback of net operating losses attributable to federally declared disasters;

§ 408(d)(8) allowance for tax-free distributions from individual retirement plans for charitable purposes;

§ 613A(c) suspension of limitation on percentage depletion for oil and gas from marginal wells;

§ 871(k) treatment of regulated investment company dividends and assets;

§ 897(h) qualified investment entity treatment of regulated investment companies under the Foreign Investment in Real Property Tax Act of 1980;

§§ 953(e) & 954(h) exceptions for active financing income;

§ 954(c) look-through treatment of payments between related controlled foreign corporations;

§ 2105(d) look-through of certain regulated investment company stock in determining gross estate of nonresidents;

§ 1367(a) basis adjustment to stock of S corporations making charitable contributions of property;

§ 1391 empowerment zone designations;

§§ 1400, 1400A & 1400B District of Columbia Enterprise Zone incentives;

§ 1400E renewal community tax incentives;

§ 1400L(b) New York Liberty Zone bonus depreciation and 1400L(d) tax-exempt bond financing;

§ 1400N Gulf Opportunity Zone rehabilitation credit; and

§ 7652(f) “cover over” of tax on distilled spirits to Puerto Rico and the U.S. Virgin Islands.

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The magazine wrote me and corrected their error. One would think the writer wouldn't miss something this big!

Posted by: PJ | Jan 15, 2010 8:36:36 AM

IRS Fact Sheet 2010-5,,id=217791,00.html

provides further information on the Savings Bond option. To obtain their refunds as Savings Bonds, taxpayers must provide a particular routing number. Also, except in the rare case in which the refund is an exact multiple of $50 (and less than $5,000), they must do this on Form 8888, not on the 1040 itself.

Any notion that taxpayers have to "opt out" is complete fantasy.

Posted by: Alan Viard | Jan 14, 2010 9:13:52 AM


The issue is what the Administration proposed, not how a magazine described the proposal. Here's the quote from the Administration proposal:

"Today, the Treasury and IRS announced that taxpayers will have another savings option beginning in early 2010 -- the ability to use their refunds to purchase U.S. savings bonds simply by checking a box on their tax return, without having to open an account at Treasury or take any other action, and even if the taxpayer doesn't have a bank account."

Posted by: Alan Viard | Jan 11, 2010 2:10:36 PM

Where is S168(k) on this list? Isn't bonus depreciation done as of 12.31.2009?

Posted by: anthony nitti | Jan 11, 2010 7:37:10 AM

Here's the quote: "Here's one change the Obama administration made for the 2010 tax year: The Internal Revenue Service will automatically issue tax refunds as savings bonds unless you opt out."

I will email the mag and check that it's not a mistake.

Posted by: PJ | Jan 10, 2010 7:41:30 AM

No, PJ, that cannot be (or, at least, is not) true.

The Treasury Department announced on September 5, 2009 that taxpayers would have the option to receive their tax refunds in the form of Savings Bonds if they opt IN by checking a box on their tax returns.

Posted by: Alan Viard | Jan 10, 2010 6:56:17 AM

What about IRC Sec. 45L - the tax credit for new energy efficient homes? Didn't this expire as well?

Posted by: MS | Jan 10, 2010 6:54:13 AM

I just read in Money Magazine that Michael Barr of the Treasury reports that our 2010 refunds will now automatically be paid to us in Savings Bonds, thanks to an Obama change. We have to specifically opt out if we want our own money back! Can this be true?

Posted by: PJ | Jan 9, 2010 10:17:35 PM

I think the operative word in yor response is - "sound". What is sound about our tax system and how such tax dollars are spent ?

Posted by: Blabla | Jan 9, 2010 3:07:33 PM

Good riddance to each and every one of these provisions. None has any place in a sound tax system.

Posted by: Anonymous | Jan 8, 2010 7:37:46 PM