Year-end federal legislation centered on COVID-19 relief and government funding also included a key provision that extends a three-year tax depreciation schedule for all racehorses through 2021.
Uniform three-year racehorse depreciation was one of several tax provisions across many industries set to expire at the end of 2020. The provision extends this more equitable depreciation schedule for all racehorses through 2021 and allows taxpayers the option to depreciate, on a three-year schedule, racehorses less than 24 months of age when purchased and placed into service.
Buyers should also take note of 100% bonus depreciation and the Sec. 179 expense allowance, two investment incentives that may be of benefit.