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2024-05: Tax deal bill moves to Senate

February 1, 2024

On January 31, 2024, the U.S. House approved the Tax Relief for American Families and Workers Act of 2024 (H.R. 7024). As we previously reported, this bill would, among other things:

  • Increase the Child Tax Credit;
  • Retroactively reinstate current expensing for domestic qualified research expenses, 100% bonus depreciation, and the larger business interest expense deduction; and
  • Significantly increase Employee Retention Credit (ERC) penalties and impose a January 31, 2024, cutoff date for new ERC claims.

For more information, see Spidell’s January 22, 2024, Flash E-mail (“Text released for proposed federal tax deal bill” available at: www.caltax.com/news/flash-email/2024-03-text-released-for-proposed-federal-tax-deal-bill).

According to news reports, to ensure passage of this bill in the House a deal was also reached to introduce another bill within the next week that would double the state and local tax deduction limit for married taxpayers filing jointly (increasing it to $20,000, from $10,000). We have yet to see the text of this bill, so we do not know whether this change will be retroactive. We will send another Flash E-mail once the text of this proposal is released.

H.R. 7024 will now be taken up in the Senate. It is unclear when the Senate will act on this bill, but we will keep you posted as news develops.

The text of H.R. 7024 is available at:

www.congress.gov/bill/118th-congress/house-bill/7024

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