Finance Committee Chairman Offers Tax Reform Amendments to Senate Proposal

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Late yesterday, November 14th, Senate Finance Committee Chairman Orrin G. Hatch released a Chairman’s modification to the Senate tax reform bill. While the 103 page document does strike a few proposals and modify a number proposals, the bulk of the document is devoted to the addition of new proposals to the bill. Some of the included modifications and additions are provided below, the full Chairman’s modification can be viewed here.

  • New proposal to reduce the amount of the individual shared responsibility payment enacted under the ACA to zero effectively repealing the individual health mandate, effective after December 31, 2018
  • Modification of the 17.4% deduction for certain pass-through income by removing the 50% of W-2 limitation for taxpayers with taxable income below $500,000 (MFJ), $250,000 (others); and to allow the deduction to taxpayers with income from a specified service business with taxable income below $500,000 (MFJ), $250,000 (others)
  • Modification to add expiration date of December 31, 2025 for all proposals contained in the individual tax reforms section of the Senate bill and for the repeal of the individual alternative minimum tax.
  • Modification to tax rates and brackets for individuals
  • Modifications limiting NOLs to 80% of taxable income in tax years beginning after 2023; and to preserve present law for NOLs of property and casualty companies
  • Modification to disallow deduction for expenses associated with meals provided for the convenience of the employer on the employers premises or other specified locations
  • New Proposal for Alaska Native Corporations and settlement trusts, with some provisions being effective for tax years beginning after December 31, 2016.
  • New Proposal to incorporate selected provisions of S.548, the Affordable Housing Credit Improvement Act of 2017
  • New Proposal to exempt certain payments related to the management of private aircraft from the excise taxes imposed on taxable transportation by air
  • New Proposal for deferring recognition of capital gains reinvested in a qualified opportunity fund and excluding capital gains from the sale of an investment in the qualified opportunity fund
  • New Proposal for treatment of qualified equity grants
  • New Proposals for Craft Beverages (beer, wine and other spirits)
  • New Proposals and modifications related to international tax reform
  • New Proposals and modifications for simplified reporting and other administrative items
  • New Proposal to repeal selected sections for taxable years beginning after December 31, 2025 if cumulative aggregate on–budget Federal revenue from all sources for the period beginning October 1, 2017 and ending September 30, 2026 exceeds specified dollar amounts

The Senate Finance Committee is expected to finish its markup this week. Meanwhile the House is set to vote on their bill this week.