Congress keeps inching towards a BBB agreement. Democrats agreed among themselves on a scaled-back plan to allow Medicare to negotiate prices on a handful of very costly drugs, along with a cap on insulin costs. That clears away one of the last outstanding issues prior to a House vote on President Biden’s latest Build Back Better plan. Still on the to-do list: immigration and the fate of the state and local tax (SALT) deduction. Speaker Nancy Pelosi remained optimistic those final issues are close to resolution.
But where is the score? Some moderate House Democrats still are demanding a Congressional Budget Office score of the spending and tax plan before they vote for it. Many of those same lawmakers also want the SALT cap changed. Sen. Joe Manchin said he also wants to see the score before the Senate votes.
Build Back Better still has a “Backdoor Roth.” In September the House Ways & Means Committee voted to bar very wealthy taxpayers from directing assets to “backdoor” and “mega backdoor” Roth individual retirement accounts. But the current $1.75 trillion Build Back Better framework retains these options for wealthy investors, at least for now.
How would President Biden’s proposed minimum book income tax on corporations work? TPC’s Thomas Brosy delves into the details. He explains how the 15 percent alternative minimum tax on the book income of large corporations differs from the regular corporate income tax and how it differs from the global intangible low-tax income (GILTI) reform proposal, as well as the pros and cons of the tax.
Will the federal government reach the debt limit sooner if the infrastructure bill passes? The $1.1 trillion bipartisan infrastructure bill would transfer $118 billion from Treasury’s General Fund to the Highway Trust Fund. It’s not clear when Treasury would have to make that transfer, but if Treasury moves the money before the debt limit is increased, there would be less available to avoid a default.
IRS refunds $14.4 billion in unemployment compensation refunds. The agency has identified more than 16 million taxpayers who may be eligible for a refund because they paid tax on COVID-19-related unemployment compensation. To date, the IRS has issued over 11.7 million refunds totaling $14.4 billion. The latest batch included 430,000 taxpayers who got refunds averaging $1,189.
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