Congress: How About a Mulligan for the Accelerated Election?

5 Pages Posted: 5 Dec 2013

See all articles by William A. Raabe

William A. Raabe

University of Wisconsin - Whitewater - College of Business and Economics

Cherie Hennig

University of North Carolina (UNC) at Wilmington - Department of Accountancy and Business Law

John Everett

Virginia Commonwealth University (VCU) - Department of Accounting

Date Written: January 12, 2009

Abstract

One of the stimulus provisions in the Housing Assistance Tax Act of 2008 was the addition of section 168(k)(4). That provision allows a rare opportunity for corporate taxpayers: the ability to cash in unused research and alternative minimum tax credit carryovers, at the cost of surrendering bonus depreciation on specified properties placed in service in 2008. The credits used under this election are refundable, an unusual trait in corporate tax law, allowing taxpayers to monetize credit carryforwards that were thought otherwise to be deferred for years or simply lost forever. However, a combination of unanswered questions, unintended consequences, and a much-too-short time frame for election all have made this provision a candidate for renewal.

Keywords: tax credit, stimulus, election, monetize, unused credits, research credit, AMT credits, depreciation

JEL Classification: H21, H25, E62, K34

Suggested Citation

Raabe, William A. and Hennig, Cherie and Everett, John, Congress: How About a Mulligan for the Accelerated Election? (January 12, 2009). Tax Notes, 2009. Available at SSRN: https://ssrn.com/abstract=2363499

William A. Raabe (Contact Author)

University of Wisconsin - Whitewater - College of Business and Economics ( email )

Whitewater, WI 53190
United States

HOME PAGE: http://billraabetax.com

Cherie Hennig

University of North Carolina (UNC) at Wilmington - Department of Accountancy and Business Law ( email )

601 S. College Road
Wilmington, NC 28403
United States

John Everett

Virginia Commonwealth University (VCU) - Department of Accounting ( email )

Richmond, VA 23284
United States

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