Tell Your Elected Officials to Include Construction Industry Priorities
The Senate made significant progress towards passing tax reform legislation this week. However, AGC still has concerns with the legislation as-is and asks you to continue contacting your members of Congress, urging them to treat S-corps fairly as compared to C-corps and maintain incentives for public and private construction in tax reform.
On Nov. 29, the Senate passed a key procedural hurdle by voting to “proceed” on the legislation, allowing the Senate to consider the legislation under a time-limited debate (20 hours) and a 50 vote basis. Typically, this expedited procedure results in a large number of amendments being offered by the minority party with very little time for debate.
Before the debate began, two Senators (Sens. Ron Johnson (R-Wis.) and Steve Daines (R-Mont.)) had raised concerns—shared by AGC—that the Senate bill would disproportionately favor C-corporations, relative to pass-through businesses such as S-corporations, LLC’s, partnerships, and sole proprietorships.
It was widely reported that, as a result of the efforts of these two Senators, the bill would increase the size of the “pass-through deduction” from 17.4 percent to 20 percent. While this is certainly an improvement over the original legislation, the deduction is still somewhat limited, as outlined in this chart, based on the characteristics of each business. AGC will continue to monitor the amendments filed during the Senate debate and support any that would improve the legislation to benefit the construction industry.
If the legislation passes – as expected – later this week, the House and Senate will convene a “conference committee” to resolve the differences between the House and Senate legislation. AGC will work to ensure that the final conference report contains the best provisions from each bill for construction.
For any questions, please contact Matthew Turkstra at [email protected], or (202) 547-4733.