TAX SEASON 2024: Tax Relief for American Families and Workers Act of 2024 Extends Expired Tax Credits and Deductions

by Mary Varano

The US House recently passed a bipartisan bill that extended several expired tax credits and deductions, as well as changed certain filing deadlines. These changes may affect your tax obligations. The bill now heads to the US Senate where it will be debated and voted on.

The Tax Relief for American Families and Workers Act of 2024 includes these provisions:

  1. Expanding the refundable portion of the Child Tax Credit for years 2023, 2024, and 2025.
  2. Shortening the Employee Retention Credit filing deadline from April 15, 2025, to January 31, 2024. This significantly shortens the time business owners have to claim the ERC.
  3. Restoring the immediate tax deduction for expenses used to calculate the research and development tax credit through December 31, 2025. This is retroactive to 2022.
  4. Easing the restriction on the deductibility of business interest by adding basic depreciation and amortization to determine business income.
  5. Extending the 100% Bonus Depreciation for qualified property placed in service after December 31, 2022, and before January 1, 2026 (January 1, 2027, for certain aircraft and longer production period property).

 In addition to the provisions listed above, there are other changes in Tax Relief for American Families and Workers Act of 2024, including:

  1. Imposing hefty penalties on tax advisors and consultants who helped employers file erroneous claims for the ERC. If passed, the penalty would be the greater of $200,000 or 75% of the revenue received from helping file the false claim
  2. Increasing due diligence requirements and penalties for tax preparers
  3. Extending recordkeeping requirements to advisors of abusive tax transactions to ERC promoters
  4. Eliminating double taxation on U.S.- Taiwan cross border investments
  5. Restoring the low-income housing tax credit to 12.5% (from 9%)
  6. Increasing the $600 threshold for filing a Form 1099-NEC for non-corporate vendors providing services to $1,000

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