ET-2 - Federal Bonus Depreciation may be Deducted for Excise Tax

The Tennessee Works Tax Act couples Tennessee with the federal bonus deprecation provisions found in the federal Tax Cuts and Jobs Act of 2017. Taxpayers may take bonus depreciation deductions for assets purchased on or after January 1, 2023, for Tennessee excise tax purposes, in the year of the purchase if the taxpayer takes bonus depreciation on the asset for federal tax purposes. For assets purchased on or before December 31, 2022, bonus depreciation deductions continue to be disallowed. 

Note: This article was updated on May 16, 2023, as a result of a law change. The previous version of ET-2 is available here.

Reference: Tenn. Code Ann. § 67-4-2006; Pub. Ch. 377 (2023).