11/23/2021

U.S. House Passes Build Back Better Act

What it could mean for our future tax actions

On Nov. 19, 2021, the U.S. House of Representatives passed a crucial part of President Joe Biden's agenda by a vote of 220-213. The Build Back Better Act (BBBA) includes numerous provisions related to areas ranging from healthcare, climate change and immigration to education, social programs and, of course, taxes.

Impact on the deficit

The House vote came after the Congressional Budget Office (CBO) released its score on the legislation on Nov. 18. The CBO estimates that the legislation will increase the deficit by $367 billion over a 10-year period.

However, the CBO score doesn’t take into account any additional revenues generated by improved compliance with federal tax laws. The BBBA allocates $80 billion for the IRS to heighten enforcement (which the CBO did include in its calculation), likely to target primarily high-wealth individuals, businesses and overseas transactions. The U.S. Treasury Department "conservatively" estimates increased IRS enforcement will lead to $400 billion in additional revenues over the 10-year period.

Please select this link to read the complete article from OSAP Member VonLehman CPA & Advisory Firm.