Notable Provisions Within New Infrastructure Law

Notable Provisions Within…

Signed into law on November 15, 2021, the $1.2 trillion Infrastructure Investment and Jobs Act (“the IIJA”) contains various provisions that may be of interest to small businesses and other employers.

In a prior article, we advised that the Employee Retention Credit (“ERC”) would remain available as to wages paid or incurred through December 31, 2021. (The ERC was designed to encourage businesses to keep employees on payroll by providing certain tax credits.) However, the IIJA retroactively terminates the ERC as of September 30, 2021 (except for employers designated as “recovery startup businesses,” which remain eligible through year end). This change is expected to reduce the maximum credit available to most businesses from $28,000 to $21,000.

Separately, the IIJA modifies existing tax law to treat digital assets (including cryptocurrencies and NFTs) as cash, and requires businesses that receive over $10,000 in digital assets to report such transactions using Form 8300. These new provisions are scheduled to become effective for “returns required to be filed, and statements required to be furnished, after December 31, 2023.” Companies considering whether to accept payments in cryptocurrency should carefully review the IIJA with their advisors.

Several other tax law changes have been proposed as part of the $1.75 trillion Build Back Better bill (“BBB”), including a minimum tax of 15% for certain large companies, an expansion of the Earned Income Tax Credit for low-wage workers, “clean energy” rebates and credits, and an extension of the American Rescue Plan Act’s expanded Child Tax Credit. The House of Representatives recently passed the BBB, and the bill is expected to be considered by the Senate within the next several weeks.

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