Details of Public Law 116-260, section 137 , Classification of Certain Race Horses as 3-Year Property

Under the PITL, for taxable years beginning on or after January 1, 2015, California law, as it relates to the Modified Accelerated Recovery System (MACRS) in general, conforms to IRC section 168 as of a specified date of 1/1/2015, with modifications.

For taxable years beginning on or after January 1, 2010, the PITL conformed to the special recovery period that provided that any race horse that was placed in service before 1/1/2014, was assigned a three-year recovery period. The PITL does not conform to any later federal extensions of this special recovery period, and does not conform to this most recent federal extension.

Under the CTL, California does not conform to federal MACRS depreciation. Instead, the CTL is generally in substantial conformity to the pre-1981 federal asset depreciation range (ADR) rules, which generally allow property to be depreciated based on its useful life. The CTL does not conform to this provision.