Year End Tax Legislation

 Year end always seems to bring a bunch of related tax legislation issues before Congress.  Congress will likely be trying to renew certain expiring tax incentives and pass some new tax breaks for individuals and businesses.

Tax Breaks for Individuals. Many popular but temporary tax incentives for individuals were scheduled to expire last year at year end. Congress renewed and/or made permanent many of these tax breaks. However, some incentives were not included in last year’s Tax Act, and thestax planninge incentives are again up for renewal or being made permanent.  These incentives include the Internal Revenue Code section 25C residential energy credit for energy-efficient improvements to homes and the above-the-line deduction for higher education tuition and fees.

Tax Breaks for Businesses. Last year’s Tax Act extended, and in some cases made permanent, certain incentives for businesses.  Some incentives, however, were not included in the Tax Act and will likely come up for renewal this December.  These incentives include incentives for film and television productions, Native American employment, the mining industry, the railroads, and motorsport complexes.   Special tax breaks for alternative fuels are scheduled to expire at year-end, but such breaks may be extended.

More Tax Proposals. Along with the incentives listed above, some stand-alone Tax Bills are expected in Congress before year-end. If passed, these Tax Bills will impact individuals, small businesses, farmers, and overall tax administration. These Tax Bills include:

(1) The Support Small Business R&D Bill, which would expand knowledge resources available to startups and small businesses in connection with their using the research and development (R&D) tax credit.

(2) The Restraining Excessive Seizure of Property through Exploitation of Civil Asset Forfeiture Tools (RESPECT) Bill, which would limit the IRS’s civil asset forfeiture authority .

(3) The Middle-Income Housing Tax Credit Bill of 2016, which would provide tax credits to encourage development of affordable housing.

(4) The Retirement Enhancement and Savings Bill of 2016, which expands tax incentives for small employers to create retirement savings plans and repeals the maximum age for contributions to traditional IRAs.

(5) The Louisiana Flood and Storm Victims Devastation Act, which provides emergency tax relief for persons affected by severe storms and flooding in Louisiana.

(6) The Farm Risk Abatement and Mitigation Election (FRAME) Act, which authorizes agricultural producers to establish and contribute to tax-exempt farm risk management accounts.

Any or all of these Tax Bills, could be part of a year-end tax package. Please call one of our tax and business attorneys if you have any questions about any of these proposed Tax Bills or any other federal or state tax matter at 937-223-1130 or


AUTHOR: Jeff Senney