On November 19, 2021, the House of Representatives voted 220 to 213 in favor of a $1.9 trillion reconciliation bill that would address “human infrastructure” priorities from the Biden administration’s Build Back Better plan such as the extension of the child care tax credit, healthcare, immigration, and climate change. The House’s adoption of the bill came after an 8.5-hour overnight speech by House Minority Leader Kevin McCarthy (R-Calif).
Prior to the vote, the House Budget Committee had released a version of the bill that increased the state and local tax deduction, added back certain retirement proposals, and retained the surcharge on high-income individuals, estates and trusts.
The legislation passed by the House includes a long list of spending measures that reflect the administration’s policy priorities, as well as a series of tax increases to offset the cost of these expenditures.
The bill, however, does not include previously proposed tax rate increases on corporations, high-income individuals and long-term capital gains and dividends.
The bill will now be sent to the Senate, where its future is less certain. While the Senate is generally expected to begin debate and ultimately pass a package, it is unclear what changes the Senate will make to its version of the bill, and whether the House will agree to those changes when the bill returns to the House for a final vote.
We will provide detailed information on the tax measures included in the bill as the text of the legislation becomes available.