Broadband Grant Tax Treatment Act

Tax Exclusion for Broadband Grants: Under Section 2(a), gross income will not include qualified broadband grants made for broadband deployment purposes. This provides a tax benefit by ensuring these specific grants are not treated as taxable income.

Specific Grant Inclusion: Section 2(c) defines "qualified broadband grant" to include several specific sources, such as:

• Grants from the Broadband Equity, Access, and Deployment Program (Section 2(c)(1)).
• Grants from the State Digital Equity Capacity Grant Program (Section 2(c)(2)).
• Grants from the Digital Equity Competitive Grant Program (Section 2(c)(3)).
• Middle mile grants (Section 2(c)(4)).
• Grants from the broadband loan and grant pilot program under the Rural Electrification Act of 1936 or the Distance Learning, Telemedicine, and Broadband Program (Section 2(c)(5)).
• Grants from State, territory, Tribal, or local governments for broadband infrastructure (Section 2(c)(6)).
• Grants received under section 905 of division N of the Consolidated Appropriations Act, 2021 (Section 2(c)(7)).

Denial of Double Benefit: According to Section 2(b), no deduction or credit is allowed for any expenditure to the extent of the amount excluded from gross income via a qualified broadband grant. This prevents recipients from receiving both the tax-free grant and a tax deduction or credit for the same expenditure.

Reduction of Property Basis: Section 2(b) states that the adjusted basis of any property shall be reduced by the amount of the excluded qualified broadband grant provided with respect to that property.