Page 86 - Large Business IRS Training Guides

Overview of IRC § 163(j)

Interest Expense Limitation

For tax years beginning after December 31, 2017,

IRC § 163(j) limits business interest expense

deductions. The amount of deductible business

interest expense (BIE) in a taxable year cannot

exceed the sum of:

1. the taxpayer’s business interest income (BII) for

the year,

2. 30% of the taxpayer’s adjusted taxable income

(ATI) for the year, and

3. the taxpayer’s floor plan financing interest

expense for the year.

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