HR2231-119

What This Bill Does

The Motorsports Fairness and Permanency Act makes a targeted tax depreciation rule permanent. Current section 168(i)(15) defines motorsports entertainment complexes and includes a sunset subparagraph. The bill strikes subparagraph (D), making the seven-year recovery period permanent for qualifying motorsports entertainment complex property. The practical effect is faster cost recovery for race tracks and related motorsports facilities than would apply under longer depreciation lives, improving after-tax project economics for track construction, improvement, and ownership.

Who Benefits and How

Motorsports entertainment complex owners benefit from permanent seven-year depreciation for qualifying property. Race track operators benefit because faster cost recovery can improve after-tax returns on facility improvements. Sports tourism developers benefit if permanent depreciation treatment makes motorsports projects easier to finance. Construction contractors working on race facilities benefit indirectly if the tax treatment encourages more track investment.

Who Bears the Burden and How

Federal taxpayers bear the revenue cost of faster and permanent depreciation deductions. IRS depreciation guidance staff must administer the permanent motorsports complex recovery period. Treasury revenue estimators must account for the ongoing cost after the sunset is removed. Competing entertainment venues do not receive the same targeted permanent seven-year recovery period.

Key Provisions

• Provides a permanent seven-year recovery period for motorsports entertainment complexes.
• Amends Internal Revenue Code section 168(i)(15) by striking the sunset subparagraph.
• Extends faster depreciation for qualifying race tracks and related motorsports facilities without a new sunset.
• Creates an ongoing depreciation rule from a temporary motorsports tax preference.