By Tom LaMarra
United States Representative Andy Barr of Kentucky has reintroduced two bills that would amend the Internal Revenue Code of 1986 to benefit racehorse owners.
Barr’s office Oct. 12 said the two bills are designed to make the tax changes permanent. Over the years they have been extended as part of other pieces of tax legislation.
The Race Horse Cost Recovery Act of 2015 would amend the code to allow for a permanent three-year depreciation period for all racehorses rather than the seven years listed in the tax code. The provision for three years is set to expire at the end of this year.
The Equine Tax Parity Act would reduce the “holding period” that determines the time for which horses can be eligible for capital gains treatment to 12 months rather than the 24 months listed in the code. Barr’s office said the code “discourages investment in the equine industry and discriminates against equine assets compared to other assets.”
Both bills were referred to the House Committee on Ways and Means.
“Kentucky’s signature horseracing industry is not only synonymous with our heritage and traditions, it is a critical source of jobs, investment, and tourism,” Barr, who co-chairs the Congressional Horse Caucus, said in a release. “As we prepare to host the Breeders’ Cup World Championships in Lexington, we should not threaten the success of our horseracing industry with discriminatory and uncertain tax policy.”
Barr said he’s working to at least win approval for the provisions in the Race Horse Cost Recovery Act in a one-year tax-break extension. But the objective, his office said, is that “both legislative fixes be made permanent to provide long-term certainty” for the industry.