IRS/Environmental cleanup costs deductible under new section 198

✍ Scribed by Shirley Dennis-Escoffier

• Book ID: 102299152
• Publisher: John Wiley and Sons
• Year: 1998
• Tongue: English
• Weight: 361 KB
• Volume: 9
• Category: Article
• ISSN: 1044-8136
• DOI: 10.1002/jcaf.3970090214

✦ Synopsis

She previously worked in public accounting and for several corporations. She has published numerous articles i n tax journals.

or companies conducting environmental cleanup activities, the critical tax issue is whether all or some of the cleanup costs are F currently deductible as expenses or whether they must be capitalized. This classification can have a dramatic impact on the economics of the cleanup project. The 1997 Taxpayer Relief Act added Internal Revenue Code Section 198 which permits taxpayers to deduct expenditures incurred to remediate certain geographically targeted areas that have been exposed to hazardous substances. Although this provision appears to allow expensing for a wide range of cleanup activities, it contains several specific criteria that must be satisfied, and provides only a three-year window in which to act to take advantage of these benefits.