Arizona ~ Property Tax: Accelerated Depreciation Schedule for Broadband Infrastructure Enacted

CCH Tax Day Report

Enacted Arizona property tax legislation provides a valuation depreciation schedule for qualifying broadband infrastructure, on a straight-line basis, as follows:

for cables, a 10-year life;

for telecommunications equipment, a five-year life; and

for any other telecommunications property, a seven-year life.

Additionally, the following accelerated depreciation schedule applies to qualifying broadband infrastructure personal property:

25% of the scheduled depreciation value for the first tax year of assessment;

41% of the scheduled depreciation value for the second tax year of assessment;

57% of the scheduled depreciation value for the third tax year of assessment;

73% of the scheduled depreciation value for the fourth tax year of assessment;

89% of the scheduled depreciation value for the fifth tax year of assessment; and

the scheduled depreciation value for the sixth and subsequent tax years of assessments.

Qualifying broadband infrastructure is prohibited from being reduced in value below 2.5% of the cost.

“Qualifying broadband infrastructure” is defined as cable, telecommunications equipment and other tangible personal property capable of being used for or in connection with the transmission of data at a rate that is equal to four megabits per second in at least one direction, including multiplexers, router, servers, fiber optics, coaxial cable and equipment supporting the transmission function first placed in service on or after January 1, 2017.

S.B. 1326, Laws 2017, effective December 31, 2017

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