Modification of reforestation expenditure rules

(a) Increase in base expensing amount Section 194(b)(1)(B) of the Internal Revenue Code of 1986 is amended— (1) in clause (i), by striking $10,000 and inserting $30,000, and (2) in clause (ii), by striking $5,000 and inserting $15,000. (b) Inflation adjustment for base expensing Section 194(b)(1) of such Code is amended by adding at the end the following new subparagraph: (C) Inflation adjustment (i) In general In the case of any taxable year beginning after 2026, each dollar amount in subparagraph (B) shall be increased by an amount equal to— (I) such dollar amount, multiplied by (II) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2025 for calendar year 2016 in subparagraph (A)(ii) thereof. (ii) Rounding If any increase determined under clause (i) is not a multiple of $100, such increase shall be rounded to the nearest multiple of $100.. (c) Effective date The amendments made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2026.