On Monday, September 13, 2021, House Ways and Committee Chairman Richard Neal released the first draft of the House Democrats’ tax legislation (including both tax increases and tax relief) they expect to consider as part of the budget reconciliation process, intended to fund key programs under President Biden’s “Build Back Better” program. The proposed changes could result in more than $2 trillion in new federal revenue over the next 10 years, mainly supported by additional payments from high-income households and U.S. companies, according to initial estimates provided by the Joint Committee of Taxation (JCT). The initial provisions of the proposed legislation are highlighted below. Note that although Democrats can pass the proposals without Republican support as part of the budget reconciliation process, amendments to the proposals are likely, given that the support of moderate Democrats is needed to pass the bill. At present, it is anticipated that moderate members of the House and Senate will require a reduction in the proposed spending and tax increases to support the bill.
We will continue to monitor developments related to these proposed tax changes and communicate any significant changes that will impact our clients. For more information, please contact your Bennett Thrasher tax advisor by calling 770.396.2200.
The above information is for general information purposes only and should not be relied upon for any specific tax implication or investment decision. Actual results may differ, and readers are cautioned not to place reliance on these general observations. Consult with your advisor or counsel before undertaking any specific action.