The House of Representatives passed the bipartisan infrastructure bill by a vote of 228-206 with 13 Republicans voting in favor and six Democrats opposing. The vote came after an agreement amongst Democrats that the social spending bill, the Build Back Better Act, would come to the House floor the week of November 15 with no further changes (other than technical corrections). Then the BBB legislation would go to the Senate, where is will likely undergo several changes before coming back to the House for a second vote.
The infrastructure bill is on its way to President Biden’s desk for his signature. It ends the ERTC, a refundable tax credit originally enacted in the CARES Act aimed at helping employers keep employees on the payroll during the pandemic shutdown, after the third quarter of this year. The ERTC had been set to expire at the end of this year.
The BBB legislation has additional measures that would likely affect NAIFA members and their clients. These include:
- A four-week federal paid family leave program covering a portion of an employee's compensation up to $62,000
- A $10 million limit on funds in retirement plans
- Expansions of the Medicare and net investment income taxes
- A new tax on corporate stock buy-backs
- Income tax increases on income over $10 million per year
- A 15% minimum tax on corporate profits in excess of $1 billion
Any of these measures could be changed or cut entirely by the Senate, with the paid family leave measure seeming to be a likely candidate for elimination.
The House bill does not limit the section 199A deduction for non-corporate business income, impose taxes on unrealized capital gains, alter the estate tax, or change grantor trust rules to the detriment of irrevocable life insurance trusts. All of these measures had been proposed during earlier BBB deliberations, and NAIFA urged that they not be included in the final legislation.