As Congress convenes in December for the post-election “lame duck” session, Republicans and Democrats face a number of year-end deadlines to find agreement on tax and spending legislation that could impact the construction industry.

As Congress convenes in December for the post-election “lame duck” session, Republicans and Democrats face a number of year-end deadlines to find agreement on tax and spending legislation that could impact the construction industry.

Currently, the federal government is operating under a “continuing resolution” which expires on December 16^th.  Negotiations over a broad “omnibus” appropriations bill to fund the government for the remainder of the fiscal year are ongoing.  Absent an agreement, or the passage of another continuing resolution, the government could face partial shutdown, although leaders from both parties have indicated this is unlikely.

Likewise, Republican and Democratic tax writers are currently in negotiations on a year-end tax package to extend and/or modify some expired or expiring tax provisions.  Among this list of expired tax provisions are two that AGC of America has supported, including and extension of the tax credit for Research and Development (the R&D credit), and the ability of deduct 100 percent of their expenses in the year they are made (100 percent expensing).  While AGC recently signed a coalition letter of support for Congress to pass legislation extending these so-called “tax extenders” before the end of the year, many Democrats have indicated that they will not support legislation that extends business tax provisions without also extending the expanded child tax credit passed as part of the American Rescue Plan in 2021.  As such, negotiations are currently at an impasse, and it is unclear if an agreement can be reached before the end of the year.

For more information, contact Matthew Turkstra at [email protected] or (202) 547-4733.