For those of you in the renewables space, the approaching July 4th deadline for ITC may be less fun than root canal and for those of you in non-tax assets, you might wonder what the fuss is all about. In the first group, missing “start of construction” by Independence Day draws a line in the sand at 12/31/27 and in the second group, you have long looked wistfully at those 30, 40 and even 50% tax credits when you bought your last piece of equipment.
For both groups, all is not lost – Section 70307 of OB3 may provide you with some relief called 100% Bonus Depreciation: Taking 100% depreciation in Year 1 is darned cool ‘cuz if you’re a 21% tax payer, that works out to a 21% tax credit.
We recently close a transaction using this regime and I’ll make it a round $1M for you to compare to the goals in your neighborhood.
Not bad!
Now we’ll spare you the details around the structure – that’s our job having written our first lease in 1976. What we will do is offer to model this for your next project!
In the meantime, save money by using the tax code!
