Georgia House Bill HB616

Georgia 2025-2026 Regular Session

• Introduced: 2/24/25

Caption

Income tax; depreciation for single-family residential rental property; revise a deduction

Impact

If enacted, HB 616 would eliminate the ability for corporations to claim certain deductions related to the depreciation of single-family residential rental properties starting in 2026. As a result, any amount deducted under Section 179 for these properties would need to be added back to the taxable income of those corporations. This shift is expected to have significant effects on the financial reporting and tax liabilities of companies that operate in the residential rental market.

Summary

House Bill 616 proposes amendments to Chapter 7 of Title 48 of the Official Code of Georgia, focusing on the taxation of income through adjustments related to depreciation for single-family residential rental properties. The bill intends to revise the existing framework around deductions, specifically targeting the rules associated with the Section 179 deduction from the Internal Revenue Code as it pertains to corporations holding single-family rental properties. The changes would be applicable for taxable years beginning on or after January 1, 2026.

Contention

There may be points of contention regarding the implications of this bill among various stakeholders. For instance, proponents may argue it helps to streamline tax regulations and ensure that rental income is taxed more uniformly. However, opponents could express concerns that such amendments might discourage investment in single-family rental properties, ultimately leading to reduced rental housing availability or higher rents. The discussions surrounding the bill will likely focus on the balance between tax revenue generation for the state and the potential impact on the housing market.