There is a technical correction in Section 168 of the new tax code that would prevent independent grocers from receiving Congress’ intended benefit of 100% bonus depreciation for qualified improvement property. The drafting error means that retailers are no longer eligible for any bonus depreciation, making them worse off than before. This is a serious concern for the independent supermarket industry, particularly businesses that plan to remodel stores in the coming years. We are gathering data for use in an upcoming report that will be created by the Tax Foundation. The report will complement NGA's legislative efforts for a fix to ensure that businesses become eligible for bonus depreciation. Filling out this survey will have a tremendous impact on showing Congress the seriousness of this issue.
Qualified improvement property is defined as any improvement to an interior portion of a building which is nonresidential real property if such improvement is placed in service after the date such building was first placed in service. Not included are any improvements for which the expenditure is attributable to the enlargement of the building, any elevator or escalator, or the internal structural framework of the building.
*Exact numbers are not necessary; estimates are fine.