Congress Passes Year-End Spending, Stimulus Bill with Tax Extenders
The Consolidated Appropriations Act, 2021 (CAA, 2021) passed Congress on December 21, 2020, and is awaiting the President’s signature. The CAA is 5,500 pages that touch on many areas of tax law, and additional changes could occur as the President is asking Congress to increase the direct stimulus checks to individuals. Some of the most significant changes are highlighted below.
The Taxpayer Certainty and Disaster Tax Relief Act of 2020, part of the Consolidated Appropriations Act of 2021, included some long-awaited assistance and clarification for many taxpayers. It contains numerous tax extenders for temporary tax provisions that expire after a short period of time. This package will extend some of these provisions and make some of them permanent.
Additional details on common Business and Individuals extenders are summarized below.
BUSINESS TAX EXTENDERS
INDIVIDUAL TAX EXTENDERS
EXTENSION OF CERTAIN EXPIRING PROVISIONS
- Sec. 101. Reduction in medical expense deduction floor.
- Sec. 102. Energy-efficient commercial buildings deduction.
- Sec. 103. Benefits provided to volunteer firefighters and emergency medical responders.
- Sec. 104. Transition from deduction for qualified tuition and related expenses to increased income limitation on lifetime learning credit.
- Sec. 105. Railroad track maintenance credit.
- Sec. 106. Certain provisions related to beer, wine and distilled spirits.
- Sec. 107. Refunds in lieu of reduced rates for certain craft beverages produced outside the United States.
- Sec. 108. Reduced rates not allowed for smuggled or illegally produced beer, wine, and spirits.
- Sec. 109. Minimum processing requirements for reduced distilled spirits rates.
- Sec. 110. Modification of single taxpayer rules.
- Sec. 111. Look-thru rule for related controlled foreign corporations.
- Sec. 112. New markets tax credit.
- Sec. 113. Work opportunity credit.
- Sec. 114. Exclusion from gross income of discharge of qualified principal residence indebtedness.
- Sec. 115. 7-year recovery period for motorsports entertainment complexes.
- Sec. 116. Expensing rules for certain productions.
- Sec. 117. Oil spill liability trust fund rate.
- Sec. 118. Empowerment zone tax incentives.
- Sec. 119. Employer credit for paid family and medical leave.
- Sec. 120. Exclusion for certain employer payments of student loans.
- Sec. 121. Extension of carbon oxide sequestration credit.
- Sec. 131. Credit for electricity produced from certain renewable resources.
- Sec. 132. Extension and phase-out of energy credit.
- Sec. 133. Treatment of mortgage insurance premiums as qualified residence interest.
- Sec. 134. Credit for health insurance costs of eligible individuals.
- Sec. 135. Indian employment credit.
- Sec. 136. Mine rescue team training credit.
- Sec. 137. Classification of certain race horses as 3-year property.
- Sec. 138. Accelerated depreciation for business property on Indian reservations.
- Sec. 139. American Samoa economic development credit.
- Sec. 140. Second-generation biofuel producer credit.
- Sec. 141. Nonbusiness energy property.
- Sec. 142. Qualified fuel cell motor vehicles.
- Sec. 143. Alternative fuel refueling property credit.
- Sec. 144. 2-wheeled plug-in electric vehicle credit.
- Sec. 145. Production credit for Indian coal facilities.
- Sec. 146. Energy-efficient homes credit.
- Sec. 147. Extension of excise tax credits relating to alternative fuels.
- Sec. 148. Extension of residential energy-efficient property credit and inclusion of biomass fuel property expenditures.
- Sec. 149. Black lung disability trust fund excise tax.
Please contact your BMF Advisor if you would like to review any of the items mentioned, schedule a tax planning strategy session or discuss potential implications of the various tax law changes.
Melissa G. Dunham?>
CPA, MTax, MBA
Michael A. Hydell?>
About the Authors
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