The House’s recent passage of H.R. 7024, known as the Tax Relief for American Families and Workers Act of 2024, marks a significant step towards potential tax reforms. However, its journey isn’t over yet, as it now heads to the Senate for further deliberation.
Here are some key highlights from the bill’s current form, which may undergo changes in the Senate:
Bonus Depreciation Adjustment: Retroactively adjusted back to 100% for the 2023 tax year, providing potential benefits for businesses investing in qualified property.
Restoration of R&D Expensing: R&D expenses no longer need to be amortized under Section 174, potentially revitalizing R&D credit studies and fostering innovation.
Changes to Interest Expense Limitations: Modifications under Section 163(j) allow for an EBITDA-based calculation, offering flexibility for businesses with higher interest expenses.
Enhanced Child Tax Credit Provisions: Potential retroactive enhancements to the Child Tax Credit provisions in 2023, providing additional support for families. Taxpayers may want to hold off on filing their individual income taxes for 2023 until after the bill has made its way through the Senate.
Expanded Section 179 Expensing: Potential expansions in Section 179 expensing, offering increased benefits for businesses investing in qualifying assets.
Accelerated ERC Filing Deadline: The bill proposes an earlier filing deadline, shifting it from April 15, 2024, to January 31, 2024, effectively ending ERC filings.
Enhanced Penalties: Stricter penalties for those found to have “aided or abetted” the filing of understated tax liabilities, emphasizing compliance and accountability.
As the bill progresses through the legislative process, we’ll keep a close eye on developments and provide updates accordingly. Stay tuned for further insights as we navigate these potential changes together!