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Archive for Joint Committee On Taxation

House Ways And Means Markup Of Build Back Better

Let's Avoid Unnecessary Costs And Complexities

Let’s Avoid Unnecessary Costs And Complexities

The House Ways and Means markup of the Build Back Better Act (H.R. 5376) has over 120 tax changes included. This includes a lot of energy credits. Subtitle G on Green Energy is laid out in 257 or the 2466 pages of legislative text. The cost estimate over ten years from the Joint Committee on Taxation is $235 billion. In comparison, the social safety net provisions in Subtitle H cost almost four times as much, but will likely provide benefits to those more than in need than for the energy credits.

For example, there is a new refundable credit proposed at new IRC §36E for the purchase of an electric bicycle costing up to $5,000 (for a $750 credit) but the bike can’t cost more than $8,000. My Google search indicates that these bikes cost under $2,000. While there likely are ones costing more, if the buyer needs the $750 credit to buy it, why not skip the credit and the complexity it will add to our tax law and the buyer can instead buy one that costs $750 less.

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Tax Laws That Have Been Recently Extended Or Changed

Joint Committee On Taxation Extenders

Recent tax law changes have extended or changed many expiring tax law provisions, including:

~Treatment of mortgage insurance premiums as qualified residence interest
~Reduction in medical expense deduction floor
~Deduction of qualified tuition and related expenses
~Energy efficient homes credit
~Employer credit for paid family and medical leave
~Work opportunity credit
~Special rule for determining earned income
~Repeal of maximum age for traditional IRA contributions
~Increase in age for required beginning date for mandatory distributions
~Expansion of section 529 plans

Download a complete list of affected tax law provisions through the Joint Committee on Taxation List of Expiring Tax Provisions 2020.

Joint Committee On Taxation: Federal Tax System For 2018

Joint Committee On Taxation

This document, prepared by the staff of the Joint Committee On Taxation (“Joint Committee Staff”), provides a summary of the present-law Federal Tax System as in effect for 2018.

The current Federal tax system has four main elements:

(1) an income tax on individuals and corporations (which consists of both a “regular” income tax and, in the case of individuals, an alternative minimum tax);

(2) payroll taxes on wages (and corresponding taxes on self-employment income) to finance certain social insurance programs;

(3) estate, gift, and generation-skipping transfer taxes; and

(4) excise taxes on selected goods and services. This document provides a broad overview of each of these elements.

A number of aspects of the Internal Revenue Code of 1986 (the “Code”), are subject to change over time. For example, some dollar amounts and income thresholds are indexed for inflation, including the standard deduction, tax rate brackets, and the annual gift tax exclusion. In general, the Internal Revenue Service (“IRS”) adjusts these numbers annually and publishes the inflation-adjusted amounts in effect for tax years beginning in a calendar year before the beginning of that year. However the IRS publication for 2018 (Rev. Proc. 2017-58) is out of date due to the December 2017 passage of Public Law No. 115-97, An Act to Provide for
Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018, often referred to as the Tax Cuts and Jobs Act (“TCJA”).Where applicable, this document generally includes actual or estimated dollar amounts in effect for 2018 and notes whether dollar amounts are indexed for inflation.

Please download this 32 page document in its entirety here.