After fifteen years of advocacy, one stimulus bill and three extenders, permanent built-in gains relief is just one short ride down Pennsylvania Avenue away from becoming law!
That’s because the Senate just voted 65-33 on passage of a tax extender bill that included numerous provisions important to the Main Street business community, clearing the way for it to go to the President’s desk, where he plans to sign it.
Getting these provisions made permanent is, to paraphrase Donald Trump, a HUGE deal, and should be the cause of celebration for businesses and tax professionals alike at holiday time. As Politico noted this morning:
Make sure to take extra notice of your surroundings, tax wonks. Because after today the world is likely to look a lot different, with so many of the more popular tax extenders removed, in some cases, from decades’ worth of a stop-and-go cycle.
“Stop-and-go” is an understatement. In just the past three years, key portions of the tax code, including small business expensing, the research and experimentation credit, our built-in gains relief, and dozens of other provisions taxpayers rely on have simply expired, twice, for the better part of an entire year, only to be reauthorized, retroactively and at the last minute, by Congresses eager to get home for the holidays.
We’re doing that again right now, only included in the package is language making the most important of these extenders permanent, so we won’t have to write this story next year! We’re confident you are as tired of reading it as we are of writing it.
Before we get to next steps, a note of thanks is in order for our terrific champions on the hill – including Representatives Reichert, Kind, Tiberi, Paulsen, and Neal and Senators Hatch, Cardin, Roberts, and Thune. In the trade world, we marched shoulder to shoulder with allies over at NFIB, ACEC, ABC, AGC, ICBA, the Beer Wholesalers, the Wine & Spirits Wholesalers, the National Grocers Association, the Multi-Housing Council, and others. It’s been a long road, and we’re ecstatic it’s coming to an end.
As for next steps, there are numerous ways to improve how S corps are taxed, including the rule prohibiting foreign investment in S corporations. That rule makes no sense, and precludes the S corporation community from an important source of capital. You can bet we’ll be up on the Hill pushing for relief from that restriction and others with the goal of making it’s easier for S corporations to raise capital, hire new employees, and succeed at their business.
We will also continue to press for tax reform that treats the pass-through community fairly! Cutting corporate rates while keeping rates on S corporations and other pass-through businesses high is not tax reform – it’s the exact opposite. So we’ll spend 2016 working with our allies in the business community to educate tax writers and make sure they understand just how important Main Street businesses are to jobs and investment in this country.
That’s it for now. Expect lots more from us in 2016 and beyond. Thanks to everyone for their support, and we sincerely hope everyone has the best of holidays in the coming weeks!