19 Nov Fate of Build Back Better Act is now up to the Senate (11-19-21)
Today, the House passed their version of the Build Back Better Act. Now the bill will be debated by the Senate, and it is anyone’s guess as to what will happen there. If the Senate passes a modified version of the bill it will have to go back to the House for final approval before being sent to the President.
Bottom line: There are no guarantees that the tax provisions contained in the bill passed by the House will be in the final version of the bill.
That being said, some of the key provisions of the House-passed bill include:
- Increasing the SALT deduction limitation from $10,000 to $80,000 retroactive to the 2021 taxable year;
- Imposing an additional 5% tax on individuals with modified AGI in excess of $10 million ($200,000 for estates and trusts) and an additional $3% tax on modified AGI in excess of $25 million ($500,000 for estates and trusts) for post-2021 tax years;
- Expanding the Net Investment Income Tax to apply to trade or business income for taxpayers with modified AGI in excess of $400,000 ($500,000 MFJ; $250,000 MFS) for post-2021 tax years;
- Continuing the ARPA’s expanded Child Tax Credit, including advance credits, for an additional year;
- Extending the ARPA’s Affordable Care Act expansions through 2025; and
- Enacting new and greatly expanding various green energy incentives.
Noticeably absent are:
- Increased capital gains tax rates;
- Increased corporate income tax rates; and
- Caps on the IRC §199A deduction.