By Greg Saul, Esq., CAE, OSCPA tax director  

On Wednesday evening, the U.S. House passed bipartisan tax legislation by a vote of 357 to 70 that would temporarily expand individual tax credits and revive several business tax breaks.  

The bill, H.R. 7024, is titled the Tax Relief for American Families and Workers Act of 2024. Below are brief highlights of the compromise, but available is a comprehensive summary here.  

The roughly $80 billion package would be paid for by ending the Employee Retention Credit (ERC) earlier than planned.  Speaking of the ERC, the IRS is hosting a webinar on Feb. 8 to provide updates on the Voluntary Disclosure Program and the moratorium. 

Individual: (1) enhances the Low-Income Housing Tax Credit, (2) increases the maximum refundable Child Tax Credit amount from $1,600 per child in the 2023 tax year to $1,800 in 2023, $1,900 in tax year 2024 and $2,000 in tax year 2025, along with adjusting it for inflation in tax years 2024 and 2025.  

Business: (1) revives immediate expensing to deduct the cost of domestic R&D investments instead of over five years, (2) revives full interest expense deductibility, and (3) revives 100% bonus depreciation to restore full and immediate expensing for investments in machines, equipment, and vehicles.  

Pay-for: ends additional applications for the Employee Retention Credit (ERC) on January 31, 2024 — originally intended to be allowed through April 15, 2025.  

H.R. 7024 awaits an uncertain future in the U.S. Senate, with some Senators calling for hearings and others requesting to make changes to the bill.