What’s New

Qualified production property. Section 1245 property now includes qualified production property, if designated and elected to be treated as such by the taxpayer under section 168(n), and placed in service after July 4, 2025, as added by P. L. 119-21, commonly known as the One Big Beautiful Bill Act. If you dispose of qualified production property placed in service after July 4, 2025, the gain will be treated as section 1245 property. See Section 1245 Property in chapter 3. Adjusted basis for section 1245 property. Qualified sound recording productions which begin in taxable years ending after July 4, 2025, are eligible for expensing under section 181, and are qualified property under section 168(k)(2). The basis of such property must be reduced by the section 181 expense deduction and any additional first year depreciation claimed for such property.

Taxpayers adjusting their basis for section 1245 property will need to consider the expiration of the clean vehicle tax credits for new and used qualified vehicles. The clean vehicle tax credits for new and used qualified vehicles under sections 25E, 30D, and 45W of the Internal Revenue Code expired on September 30, 2025, due to the enactment of P.L. 119-21. See Section 1245 Property in chapter 3. Information returns. Information returns now include Form 1099-DA, Digital Asset Proceeds from Broker Transactions, for any digital asset transaction. See Information Returns in chapter 4 for more information.