Finance Committee Outlines Changes to H.R. 1 on Senate Floor

Tax Cuts and Jobs Act (H.R.)
Changes Made to the Committee-Reported Bill
During Floor Consideration

Changes Made by the Perfecting Amendment (Hatch #1618)
(Note: All JCT estimates are relative to the committee-reported version of H.R. 1)

Modifications

• Increased Pass-Through Deduction (Sec. 11011)

  • This provision increased the deduction for qualified business income on individual returns from 17.4 percent to 23 percent of such income.

  • JCT Estimate: This change would reduce revenues by an additional $114 billion over ten years.

• Extended Bonus Depreciation (Sec. 13204)

  • This provision extends the bill's five-year 100 percent expensing period for an additional four years, decreasing gradually over that time.

  • JCT Estimate: This change would decrease revenues by $35 billion over ten years.

• Restoration of IC-DISC (Sec. 14224)

  • This provision preserves current law tax treatment for Interest Charge Domestic International Sales Corporations.

  • JCT Estimate: This change would reduce revenues by $5.3 billion over ten years

• Treatment of non-profit and clergy pension plans (Sec. 13611)

  • This provision maintains current law pension contribution limits for employees of non-profits and governmental entities.

  • JCT Estimate: This change would reduce revenues by $1.7 billion over ten years.

• Increased AMT exemption and phase-out (Sec. 12002)

  • This provision maintains the individual AMT, with increased exemption amounts and phase-out thresholds.

  • JCT Estimate: This provision would increase revenues by $132.9 billion over ten years.

• Increased Toll On Repatriated Corporate Earnings (Sec. 14103)

  • This provision increases the toll on earnings deemed repatriated under the bill to 14.49 percent for liquid assets and 7.49 percent for illiquid assets.

  • JCT Estimate: This change would increase revenues by $113B over 10 years.

• Corporate AMT Reinstated (Sec. 12001 )

  • This provision strikes the repeal of the corporate alternative minimum tax, maintaining current law

  • JCT Estimate: This change would increase revenues by $40.3 billion over 10 years.

• Child Tax Credit Eligibility Adjustment (Sec. 11022)

  • This provision decreased the age of a child qualifying for the expanded credit from 17 to 16 (same as current law), for 2025.

  • JCT Estimate: This change would increase revenues by $4.6 billion over 10 years.

Provisions Removed for Byrd Rule Compliance

• Sec. 11028 — 529 savings accounts for unborn children

• Sec. 11029 — Relief for Mississippi Delta Flood Disaster

• Sec. 11072 — Individuals held harmless on improper levy on retirement plans

• Sec. 11074 — Form 1040SR for Seniors

• Sec. 11075 — Sense of the Senate on improving customer service and protections for taxpayers by reinstating appropriate funding levels

• Sec. 11076 — Return preparation programs for low-income taxpayers

• Sec. 11077 — Free File Program

• Sec. 13011 — Dividends paid deduction

• Sec. 13303(b)(5) — Special rules for certain mutual ditch companies

• Sec. 13401(b) — Public disclosure regarding orphan drug credit

• Secs. 13411-13416 — Revisions to the Low-Income Housing Tax Credit.

• Sec. 13704 —Repeal of tax-exempt status professional sports leagues.

• Sec. 13705 — Modification of taxes on excess benefit transactions.

• Sec. 13706 — Exemption from private foundation excess business holding tax for independently operated philanthropic business holdings

• Sec. 13801 — Craft Beverage Modernization and Tax Reform — Rule of construction

• Sec. 13804 — Craft Beverage Modernization and Tax Reform — Simplification of rules regarding records, statements and returns

• Sec. 14505 — Repeal of exclusion applicable to certain passenger aircraft operated by a foreign corporation.

Amendments Filed and Accepted

• Ernst #1588

  • Eliminates deduction for members of Congress's living expenses

  • JCT Estimate: Increases revenue by less than $50 million

• Graham #1595

  • Strikes bill's provision on the treatment of contingency fee cases

  • JCT Estimate: Reduces revenue by $500 million

• Collins #1613

  • Repeals Obamacare limit on the deductibility of medical expenses, allowing deduction if medical expenses exceed 7.5 percent of AGI

  • JCT Estimate: Reduces revenue by $4.6 billion

• Paul #1622 & Hoeven #1673

  • Makes interest costs for vehicle floor plan financing fully deductible

  • JCT Estimate: Reduces revenue by $600 million

• Murkowski #1630

  • Modifies the bill's provisions regarding tax treatment of Alaska Native Corporations

  • JCT Estimate: Increases revenue by less than $50 million

• Roberts #1631

  • Treat agricultural/horticultural co-ops same as other farming businesses

  • JCT Estimate: Reduces revenue by less than $50 million

• Roberts #1632

  • Modifies the low income housing credit to add preferences for veterans and rural housing

  • JCT Estimate: Reduces revenue by less than $50 million

• Sullivan #1678

  • Strikes the provision of the bill relating to passenger cruise ships

  • JCT Estimate: Reduces revenue by $700 million

• Hatch #1684

  • Prohibit cash or gift cards as employee achievement awards

  • JCT Estimate: Increases revenue by less than $50 million

• Thune #1711(modified)

  • Provides pass-through deduction to certain agricultural and horticultural cooperatives (with modified effective date)

  • JCT Estimate: Reduces revenue by less than $50 million

• Cornyn #1715

  • Allows the deduction for pass-through business income to apply to distributions from publicly-traded partnerships

  • JCT Estimate: Reduces revenue by $700 million

• Hatch #1724

  • Strikes the provision treating name and logo royalties as UBIT

  • JCT Estimate: Reduces revenue by $2 billion

• Hatch #1728

  • Clarifies the effective date for the recovery period for real property

  • JCT Estimate: Reduces revenue by $400 million

• Hatch #1729

  • Clarifies the effective date of repeal of Section 199

  • JCT Estimate: Increases revenue by $3.7 billion

• Hatch #1730

  • Makes a technical change to the partnership provisions for the interest deduction limitation

  • JCT Estimate: No revenue effect

• Hatch #1731

  • Clarifies the definition of total equity for the purposes of the bill's worldwide interest limitation rule

  • JCT Estimate: No revenue effect

• Rounds #1735

  • Adds an exemption for mortgage service rights from the requirements of the new income inclusion rule

  • JCT Estimate: Reduces revenue by $3.8 billion

• Alexander #1738

  • Raises the required asset/student for the university endowment excise tax from $250,000/student to $500,000/student

  • JCT Estimate: Reduces revenue by $700 million

• Burr #1745

  • Clarifies the limit on contributions to ABLE Act accounts

  • JCT Estimate: Reduces revenue by $400 million

• Cassidy #1756

  • Modifies the rules regarding overall domestic losses for purposes of the foreign tax credit

  • JCT Estimate: Reduces revenue by $1.8 billion

• Isakson #1764

  • Provides separate rules regarding the timing of inclusion of income for original issue discount

  • JCT Estimate: Reduces revenue by $700 million

• Fischer #1793

  • Improves employer credit for paid family and medical leave

  • JCT Estimate: Increases revenue by less than $50 million

• Cassidy #1794

  • provides tax relief to individuals in all areas declared disasters in 2016

  • JCT Estimate: Reduces revenue by $4.6 billion

• Hatch #1809

  • Clarifies the definition of qualified trade or business for the purposes of the bill's pass-through deduction

  • JCT Estimate: Negligible effect

• Toomey #1816

  • Provides a phase-in for the indebtedness requirements of the worldwide interest limitation rule

  • JCT Estimate: Reduces revenue by $400 million

• Hatch #1819

  • Clarification on rules relating to foreign-derived, related-party intangible income

  • JCT Estimate: Negligible Effect

• Hatch #1820

  • Modifies the treatment of S corporations converting to C corporations

  • JCT Estimate: Reduces revenue by $6.1 billion

• Scott #1826

  • Modifies rules regarding the tax treatment of life insurance companies

  • JCT Estimate: Increases revenue by $23 billion

• Scott #1833

  • Modifies bill's provision on opportunity zones

  • JCT Estimate: No revenue effect

• Hatch #1836

  • Modifications to the BEAT for certain financial institutions

  • JCT Estimate: Increases revenue by $2.4 billion