Center for Federal Tax Policy

Cost Recovery

Cost recovery is the ability of businesses to recover (deduct) the costs of their investments. Although sometimes overlooked in discussions about corporate taxation, capital cost recovery plays an important role in defining a business’s tax base and can impact investment decisions—with far-reaching economic consequences. When businesses are not allowed to fully deduct capital expenditures, they spend less on capital, which reduces worker productivity and wages.

Related Articles

Business Investment Increases by 39 Percent in Q1 2018

Recommendations to Congress on the 2018 Tax Extenders

Lawmakers May Vote on Making Key Provisions of the TCJA Permanent

Tax Reform Isn’t Done

Trade and Capital Flow Consequences of Tax Reform: A Means to a Faster Expansion of U.S. Capital Formation and Employment

House and Senate Bill Limits on Interest Deductions

Responding to a Critique of the Taxes and Growth Model

Important Differences Between the House and Senate Tax Reform Bills Heading into Conference

Key Changes in Senate Tax Reform Bill Heading into the Vote-a-Rama

Overview of the Senate’s Amendment to the Tax Cuts and Jobs Act

Important Differences Between House and Senate Versions of the Tax Cuts and Jobs Act

Details of the House Tax Cuts and Jobs Act

There Is More Than Meets the Eye When Analyzing the UK’s Corporate Tax Cut

Options for Improving Cost Recovery for Structures

Economic and Budgetary Impact of Temporary Expensing

Testimony: The Startup Slump: Can Tax Reform Help Revive American Entrepreneurship?

The Four Pillars of Corporate Tax Reform: Testimony before the Senate Finance Committee

What Would “Unprecedented Capital Expensing” Look Like?

Comments on Today’s Joint Statement on Tax Reform

How a Longer Budget Window Helps and Doesn’t