John,
Large corporations are preparing to cash in on a tax loophole that allows $16 billion in retroactive write-offs, while the cost is borne by everyone else through deeper budget holes and future spending cuts. The loophole is 100% bonus depreciation, which allows corporations to deduct the full cost of equipment in a single year instead of spreading those deductions over time, which better reflects its slow loss of value.[1]
Americans for Tax Fairness has repeatedly warned that this policy drains public revenue while delivering disproportionate benefits to a small number of large corporations. It accelerates tax avoidance and locks in losses for the public.[2]
The long-term cost is massive. Over the next ten years, bonus depreciation is projected to cost taxpayers more than $362 billion. Analyses by Americans for Tax Fairness and ITEP show that two-thirds of the benefits flow to corporations with more than $250 million in annual revenue. A small group of mega corporations captured nearly $43 billion from this loophole over five years while reporting more than $1 trillion in profits.
Those tax savings did not translate into broad economic gains. Corporations used the windfall to finance stock buybacks, dividend payouts, and outsized executive compensation, not to raise wages or expand productive investment. Independent economic analysis shows the policy produces weak economic returns while concentrating benefits at the very top.
Congress created this loophole. Corporations are already preparing to exploit it. And unless lawmakers act, the costs will be locked in for years to come. Public pressure now can still force Congress to reverse course and shut this loophole down.
Tell Congress to eliminate bonus depreciation, block future corporate write-offs, and reverse this costly tax break before it drains hundreds of billions more from public revenue.
When Republicans passed their Big Ugly Bill, they made bonus depreciation permanent. But there is still time for Congress to reverse course and make clear that repeated corporate giveaways will not be rewarded. Eliminating it would protect public revenue and help restore basic fairness to the tax code.
Public pressure is the only counterweight strong enough to force lawmakers to repeal bonus depreciation, prevent future revenue losses, and end this loophole.
Tell Congress to eliminate bonus depreciation and end this corporate tax giveaway now.
Let’s hold Congress accountable and demand they fix the broken tax code.
David Kass
Executive Director
Americans for Tax Fairness Action Fund
[1] Corporations to claim $16B from retroactive GOP tax break, federal report says
[2] Ways & Means Mark-Up Trump Tax Law 2.0 Analysis
