The second major move affects bonus depreciation rules. The current 50% rate will be reduced to 40% in 2018 and to 30% in 2019. On the positive side, additional first-year depreciation will be allowed for qualified improvement property without regard to whether the improvements are property that’s subject to a lease. Also, the provision modifies and extends the election to increase the alternative minimum tax (AMT) credit limitation in lieu of bonus depreciation for five years to property placed in service before January 1, 2020.

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