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Realigning the code
Tax provisions in the Build Back Better Act
Momentum is building among congressional Democrats to approve the Build Back Better Act, a massive bill that includes significant tax increases impacting large corporations and high-income individuals to pay for lower- and middle-class tax relief and fund new spending for White House priorities such as expanded access to prekindergarten education, child care and elder care, and affordable housing, as well as programs to mitigate climate change.
Proposed tax law changes in the Build Back Better Act
President Biden based the economic planks of his 2020 election campaign on the premise that the benefits of 2017’s Tax Cuts and Jobs Act (TCJA) were skewed to large corporations and wealthy individuals and that the federal income tax system needs to be modified to ensure that these taxpayers are contributing “their fair share.” To that end, he proposed to scale back certain TCJA provisions and enact “base broadeners” that would limit or eliminate various incentives currently available to these taxpayers. Many of these proposals were previewed during the campaign, then made their way into the fiscal year 2022 budget blueprint the administration released in May of this year, and finally into the Build Back Better Act that is now moving through Congress. Our new report, Realigning the code: Tax provisions in the Build Back Better Act, looks at the proposed revenue and incentive provisions in the new legislation and discusses what taxpayers can do to prepare for the coming changes.