Technical Bulletin No. 0126: Federal Income Tax Treatment of Capital Expenditures for Waste Treatment Plants

During the past few years numerous bills have been introduced in Congress providing for accelerated amortization of capital expenditures for waste treatment facilities. To date, none of these bills have been enacted. There are, however, certain provisions in the existing Internal Revenue Code for various methods of capitalizing and recovering such expenditures.  The purpose of this paper is to discuss in general terms the Federal income tax treatment of capital expenditures made by pulp and paper manufacturers for waste treatment plants owned and operated with their mills for the purpose of preventing water pollution.