What This Bill Does
This bill amends tax law to allow businesses a special tax deduction (called bonus depreciation, which lets you deduct the cost of equipment faster) for certain space launch equipment and vehicles. The bill extends this tax benefit through January 1, 2033 for qualifying space launch property launched from the United States.
Who It Affects
Businesses and companies that own or operate space transportation vehicles, payloads, or equipment used to facilitate space launches from the United States.
Key Provisions
• Businesses can claim 100 percent bonus depreciation on qualified domestic space launch property placed in service after December 31, 2023 and before January 1, 2033 (Sec. 2(b)).
• Qualified domestic space launch property includes space transportation vehicles or payloads launched from the United States, or other equipment placed in service to facilitate a space launch from the United States (Sec. 2(c)).
• A space vehicle or payload launched from an aircraft counts as launched from the United States only if it is substantially manufactured within the United States and the aircraft flight originated from United States soil (Sec. 2(c)).
• The term "United States" includes U.S. possessions (Sec. 2(c)).
What Changes
Businesses can now claim a full 100 percent tax deduction on the cost of qualifying space launch property in the year it is placed into service, rather than deducting it over multiple years.
Important Definitions
• Qualified domestic space launch property: Space transportation vehicles, payloads, or other equipment used to facilitate space launches from the United States, placed in service before January 1, 2033.
• Applicable percentage: The portion of property cost that can be immediately deducted, set at 100 percent for qualifying space launch property.
Effective Date
The amendments apply to property placed in service after December 31, 2023 (Sec. 2(d)).
I
118TH CONGRESS
1ST SESSION H. R. 1363
To amend the Internal Revenue Code of 1986 to provide bonus depreciation
for certain space launch expenditures, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 3, 2023
Mr. POSEY (for himself and Mr. SOTO) introduced the following bill; which
was referred to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to provide
bonus depreciation for certain space launch expenditures,
and for other purposes.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE.
3
This Act may be cited as the ‘‘American Space Com-
4
merce Act of 2023’’.
5
SEC. 2. SPECIAL ALLOWANCE FOR QUALIFIED DOMESTIC
6
SPACE LAUNCH PROPERTY.
7
(a) ALLOWANCE
OF BONUS DEPRECIATION
FOR
8
QUALIFIED DOMESTIC SPACE LAUNCH PROPERTY.—Sec-
9
VerDate Sep 11 2014
22:26 Mar 17, 2023
Jkt 039200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H1363.IH
H1363
kjohnson on DSK79L0C42PROD with BILLS
2
•HR 1363 IH
tion 168(k)(2)(A)(i) of the Internal Revenue Code of 1986
1
is amended—
2
(1) by striking ‘‘or’’ at the end of subclause
3
(III),
4
(2) by striking ‘‘or’’ at the end of subclause
5
(IV),
6
(3) by adding ‘‘or’’ at the end of subclause (V),
7
and
8
(4) by adding at the end the following new sub-
9
clause:
10
‘‘(VI) which is qualified domestic
11
space launch property (as defined in
12
paragraph (11)),’’.
13
(b) EXTENSION OF TERMINATION OF BONUS DEPRE-
14
CIATION
FOR QUALIFIED DOMESTIC SPACE LAUNCH
15
PROPERTY.—
16
(1) IN GENERAL.—Section 168(k)(2)(A)(iii) of
17
the Internal Revenue Code of 1986 is amended by
18
inserting ‘‘(in the case of qualified domestic space
19
launch property, before January 1, 2033)’’ after
20
‘‘before January 1, 2027’’.
21
(2) APPLICATION
OF
APPLICABLE
PERCENT-
22
AGE.—Section 168(k)(6) of such Code is amended
23
by adding at the end the following new subpara-
24
graph:
25
VerDate Sep 11 2014
22:26 Mar 17, 2023
Jkt 039200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H1363.IH
H1363
kjohnson on DSK79L0C42PROD with BILLS
3
•HR 1363 IH
‘‘(D) RULE
FOR
QUALIFIED
DOMESTIC
1
SPACE
LAUNCH
PROPERTY.—Notwithstanding
2
any other provisions of this paragraph, in the
3
case of any qualified property which is qualified
4
domestic space launch property, the term ‘appli-
5
cable percentage’ means, in the case of property
6
placed in service after December 31, 2023, and
7
before January 1, 2033, 100 percent.’’.
8
(c) QUALIFIED DOMESTIC SPACE LAUNCH PROP-
9
ERTY DEFINED.—Section 168(k) of the Internal Revenue
10
Code of 1986 is amended by adding at the end the fol-
11
lowing new paragraph:
12
‘‘(11) QUALIFIED
DOMESTIC
SPACE
LAUNCH
13
PROPERTY
DEFINED.—For purposes of this sub-
14
section—
15
‘‘(A) IN
GENERAL.—The term ‘qualified
16
domestic space launch property’ means property
17
placed in service before January 1, 2033, that
18
is—
19
‘‘(i) a space transportation vehicle or
20
payload (as such terms are defined in sec-
21
tion 50101 of title 51, United States Code)
22
that is launched from the United States, or
23
‘‘(ii) other property or equipment
24
placed in service for the purpose of facili-
25
VerDate Sep 11 2014
22:26 Mar 17, 2023
Jkt 039200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H1363.IH
H1363
kjohnson on DSK79L0C42PROD with BILLS
4
•HR 1363 IH
tating a space launch from the United
1
States.
2
‘‘(B) SPECIAL RULE FOR SPACE LAUNCHES
3
FROM AIRCRAFT.—A space transportation vehi-
4
cle or payload that is launched from an aircraft
5
shall be considered to be launched from the
6
United States if, and only if, such space trans-
7
portation vehicle or payload is—
8
‘‘(i) substantially manufactured within
9
the United States, as determined by the
10
Secretary, and
11
‘‘(ii) launched from an aircraft on a
12
flight that originated from United States
13
soil.
14
‘‘(C) UNITED STATES.—The term ‘United
15
States’ includes the possessions of the United
16
States.’’.
17
(d) EFFECTIVE DATE.—The amendments made by
18
this section shall apply to property placed in service after
19
December 31, 2023.
20
Æ
VerDate Sep 11 2014
22:26 Mar 17, 2023
Jkt 039200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6301
E:\BILLS\H1363.IH
H1363
kjohnson on DSK79L0C42PROD with BILLS