H.R. 10448 – Reverse Big Ugly Tax Breaks for Data Centers Act

AI-Generated Summary

Updated September 24, 2026 at 2:50 AM UTC

The bill changes the tax code so that large data‑center equipment is no longer eligible for bonus depreciation and also cannot be counted as qualified opportunity‑zone business property. It applies to any property used in or dedicated to a data center that meets certain size and function criteria, and it takes effect for assets placed in service after the law is passed.

Key Provisions

Adds an exception to bonus depreciation: property that is part of a "qualified data center" is excluded from the accelerated depreciation rules.
Defines "qualified data center property" as equipment used in, or dedicated to, a "covered data center".
Defines a "covered data center" as a permanent (or semi‑permanent) structure or group of structures with a power capacity over 50 megawatts, dedicated to centralized IT, network telecom equipment for data storage, processing, transport, or AI development/training/operation.
Excludes covered data centers and qualified data center property from being treated as "qualified opportunity zone business property" under the opportunity‑zone tax incentives.
Both changes apply only to property placed in service or acquired in taxable years beginning after the law’s enactment.

Legislative Activity

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1 earlier action

HouseIntro Referral Latest Action

Referred to the House Committee on Ways and Means.

Ways and Means Committee

September 16, 2026

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HouseIntro Referral

Introduced in House

September 16, 2026

HouseIntro Referral

Referred to the House Committee on Ways and Means.

Ways and Means Committee

September 16, 2026

Bill Text

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Introduced in HouseIssued September 16, 2026

I

119th CONGRESS

2d Session

H. R. 10448

IN THE HOUSE OF REPRESENTATIVES

September 16, 2026

Ms. McDonald Rivet (for herself, Mr. Davis of North Carolina, Ms. Castor of Florida, Ms. Davids of Kansas, Ms. Dean of Pennsylvania, Mr. Deluzio, Mr. Vicente Gonzalez of Texas, Mrs. Grijalva, Mr. Landsman, Mr. Mannion, Mr. Levin, Mrs. McClain Delaney, Ms. McCollum, Mr. Panetta, Mr. Pappas, Ms. Ross, Mr. Stanton, Ms. Titus, Mrs. Torres of California, Mr. Tran, Mr. Vasquez, Mr. Vindman, Ms. Wasserman Schultz, Ms. Salinas, Mr. Larsen of Washington, Ms. Houlahan, and Ms. Kaptur) introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to exempt qualified data center property from bonus depreciation, and for other purposes.

1.

Short title

This Act may be cited as the Reverse Big Ugly Tax Breaks for Data Centers Act.

2.

Exempting qualified data center property from bonus depreciation

(a)

In general

Section 168(k)(2) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

(I)

Exception for qualified data center property

(i)

In general

The term qualified property shall not include any qualified data center property.

(ii)

Qualified data center property

For purposes of this subparagraph, the term qualified data center property means any property which—

(I)

is used in a covered data center, or

(II)

is located outside of a covered data center but dedicated to the operation of such data center.

(iii)

Covered data center

For purposes of this subparagraph, the term covered data center means a permanent or semipermanent structure, or group of such structures, which—

(I)

has a maximum rated power capacity or total peak power load in excess of 50 megawatts, and

(II)

is dedicated to the centralized accommodation, interconnection, and operation of information technology and network telecommunications equipment used for—

(aa)

data storage, processing, and transport services, or

(bb)

developing, providing training in, or operating artificial intelligence.

(iv)

Artificial intelligence

For purposes of this subparagraph, the term artificial intelligence has the meaning given such term in section 5002 of the National Artificial Intelligence Initiative Act of 2020.

.

(b)

Effective date

The amendment made by this section shall apply to property placed in service in taxable years beginning after the date of the enactment of this Act.

3.

Data centers not treated as qualified opportunity zone business property

(a)

In general

Section 1400Z–2(d)(2)(D) of the Internal Revenue Code of 1986 is amended by adding at the end the following new clause:

(iv)

Exclusion

The term qualified opportunity zone business property shall not include any covered data center (as defined in clause (iii) of section 168(k)(2)(I)) or any qualified data center property (as defined in clause (ii) of such section).

.

(b)

Effective date

The amendment made by this section shall apply to property acquired in taxable years beginning after the date of the enactment of this Act.