Details of Public Law 117-58, section 80601 , Infrastructure Investment and Jobs Act, Modification of Tax Treatment of Contributions to the Capital of a Corporation

This section restores the gross income exclusion for amounts of money or property received from any person (whether or not a shareholder) by regulated public water or sewage disposal utilities. A "contribution to the capital of the taxpayer" is eligible for the exclusion, if the amount is:

Any contribution in aid of construction or any contribution by any governmental entity providing protection, preservation or enhancement of drinking water or sewerage disposal services,

Any contribution in aid of construction of property other than water or sewerage disposal facilities, must meet the expenditure rule, and

The amount, or property acquired or constructed with the amount, is not included in the taxpayer’s rate base for ratemaking purposes.

Any deduction or credit would be disallowed for any expenditure provided as a contribution in aid of construction eligible for this exclusion. Additionally, a property’s adjusted basis of any property acquired with contributions in aid of construction must be adjusted to zero.

The section also restores the statute of limitation period and removes the requirement for the Secretary of the Treasury to issue regulations or other guidance to implement these rules, including regulations or other guidance for determining whether any contribution is a contribution in aid of construction.