Senate Finance Committee Releases Tax Provisions Of Build Back Better Act

The Senate Finance Committee released its portion of the Build Back Better Act on Saturday containing tax provisions and other updated legislative text.

In an announcement, committee Chair Sen. Ron Wyden, D-Ore., said the committee had made "targeted improvements" in the 1,180-page portion of the act, which was passed in its entirety by the House on November 19, 2022 (H.R. 5376; see prior coverage of its tax and other provisions).

Call the "Tax Pros on Demand" now at 215.550.3636, from 1000am to 1000pm, Monday through Sunday, should you have any questions on this or any other subject matters related to your business's or your individual income tax returns.

Senate committees of Commerce, Small Business, Banking and Housing, and Veterans Affairs also are among committees that have released their portions of the Senate version of the Build Back Better Act, Senate Majority Leader Chuck Schumer, D-N.Y., said last week.

Besides revenue, the Senate Finance Committee's title (Title XII of the bill) includes provisions on nontax matters including paid leave, health care, the environment, higher education, and trade.

Click Here To Qualify! For A $20,000 Unsecured Line Of Credit Without A Personal Guarantee.

Wyden said his committee modified the House's text of the bill with technical and policy changes plus changes to comply with Senate budget rules. The chamber's parliamentarian has yet to weigh in on rules compliance. 

One thing that is not in the Senate version is any change in the current (through 2025) cap on itemized deductions of state and local taxes under IRS Section 164(b). The House version would increase the current $10,000 limit to $80,000 ($40,000 for married taxpayers filing separately and trusts and estates).

“Click Here to Discover” How to Secure Lender Funding to Grow Your Business Even with Damaged Personal Credit.

Changes may be made on the Senate floor later, including by an amendment adding a SALT provision (which was also added by amendment in the House).

Also like the House version, the Senate text extends the 2021 expansion of the child tax credit through 2022 and also extends advance payments of the credit monthly through 2022. It also would extend the greater refundability of the credit beyond 2022.

The Senate text, like the House bill, includes an extension of the 2021 changes to the earned income tax credit through 2022. The increase in the earned income and phaseout amounts would be indexed for inflation in 2022.

The legislation also would modify IRS Section 1202, which provides a gain exclusion for stock of qualified small businesses if held for more than five years, by disallowing 75% and 100% exclusions for taxpayers with adjusted gross income (AGI) over $400,000 or for trusts or estates.

Click Here Now! Should You Be Feeling Overwhelmed By Your Debt? Take A Deep Breath And Contact Us NOW! The Complete Debt Relief Manual Is All You Need To Resolve Debit, IRS Tax Liabilities, Lawsuits, Credit Repair and Bankruptcy.

The bill would expand the reach of the IRS Section 1411 net investment income subject to a surtax of 3.8% of certain high-income taxpayers (taxable income over $400,000 for single filers and $500,000 for married couples filing jointly) to include income derived in the ordinary course of a trade or business.

A new IRS Code Section 1A would impose a tax on modified AGI over $10 million of 5% for individuals ($5 million for married taxpayers filing separately) and $200,000 for an estate or trust, plus 3% of modified AGI over $25 million for individuals ($12.5 million for married taxpayers filing separately) and $500,000 for an estate or trust.

Your Tax Pro On Demand

R Clyde Olivieri, Jr. 

P.S.  Should you believe to have fallen into a situation related to this issue and know not what to do, or how to handle your specific matter, call us now, at 215.550.3636, from 1000am until 1000pm, Monday through Sunday. We will come up with solutions or suggestions, related to your potential tax consequences. We have convenient evening and weekend appointment hours.

Click Here Now to Erase all bad debts history, delete any negative comments, and increase your FICO score on your credit report.