The Election You Made in 2022 Is Blocking Your 2026 Plant
A defensive tax move many companies made to escape the old interest limits is irrevocable, and it quietly disqualifies new production buildings from full expensing. Nobody made this election wrong. The rules changed around it. Between 2018 and 2024, Section 163(j) limited business interest deductions, and from 2022 onward the limit tightened sharply because it […]
Drillers Have Too Many Deductions
The industry’s expensing culture made sense when deductions were scarce. Layer 100% bonus on top of IDCs and losses left over from the last downturn, and it has become a trap. Oil and gas operators understand accelerated cost recovery better than almost any industry in America. Intangible drilling costs have been immediately deductible for decades. […]
Permanence Killed the Urgency
Congress made bonus depreciation permanent to encourage investment. It may have made companies worse at capturing it. Deadlines are underrated management tools. Nothing focuses a capital planning process like a benefit that is about to shrink. From 2018 through 2024, bonus depreciation had a built-in deadline. The 2017 tax law set 100% expensing to step […]
100% Bonus Depreciation Is Worthless to Half the Companies Claiming It
A deduction is only worth what it saves. For capital-intensive operators carrying losses, the most celebrated provision in the OBBBA is a slow-motion write-down. Worthless overstates it. Not by as much as you would think. When the One Big Beautiful Bill Act restored permanent 100% bonus depreciation, the headlines treated it as a universal gift […]
That Jet You Ordered in 2024 Is Not Getting 100%
Two companies, two super-midsize jets, the same delivery quarter. One captures more than $4.6 million in year-one tax value. The other captures barely half its board was promised. The difference was settled before either aircraft left the factory. The aircraft sales presentation almost always includes the same slide. Under the One Big Beautiful Bill Act, […]
Your Deal Model Is Three Years Stale
Sponsors are pricing add-ons on interest math from 2022, treating purchase price allocation as paperwork, and sitting on elections that block the biggest incentive in the law. TO: Operating Partners and Portfolio Company CFOs RE: Six places the OBBBA is not yet in your numbers Private equity prides itself on underwriting. Right now, a meaningful […]
Your Landlord Just Took Your Factory Deduction
An open letter to every manufacturer planning new capacity before 2029, and especially to those about to sign a build-to-suit lease. To the CFO with a build-to-suit proposal on your desk, You have probably heard the pitch. A developer builds your new plant to your specifications, you sign a long-term lease, and you preserve your […]
Your Tax Department Is the Last to Know, and It Is Costing You Millions
The largest capital investment incentive in a generation is being decided by people who do not know it applies to them. That is not a tax problem. It is a governance problem. Pull out your company’s capital expenditure approval form. It probably asks for the vendor quote, the payback period, the IRR, maybe a lease-versus-buy […]
The Cheapest Loan You Take This Year Will Be the Most Expensive
A defensive tax move many companies made to escape the old interest limits is irrevocable, and it quietly disqualifies new production buildings from full expensing. Nobody made this election wrong. The rules changed around it. Between 2018 and 2024, Section 163(j) limited business interest deductions, and from 2022 onward the limit tightened sharply because it […]
Allocate Cost to Consumption
Walk through almost any middle-market capital plan and the same pattern appears. The equipment decision is made carefully: specifications, vendor selection, integration planning, payback analysis. The capital decision is made by default. Pay cash if there is cash. Borrow if there is not. Amortize to zero over a term that roughly matches the depreciation schedule. […]