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New Infrastructure Bill (Not Yet Signed Into Law) - August 2021
After lengthy negotiations, Senators came to an agreement on provisions and funding for their bipartisan infrastructure bill and released bill text over the weekend.
Here are the key provisions of the bill “Infrastructure Investment and Jobs Act”:
ERTC will end early
The bill changes the Employee Retention Credit such that you can only take it through the third quarter of 2021. Wages paid after September 30, 2021, will not be eligible except for recovery startup businesses (which will claim the credit for Q4 2021). [§80604(a)(2)]
Looser definition of a “recovery startup business”
Remove the requirement that a “recovery startup business” cannot be a business that experienced a government shutdown or that had an 80% drop in gross receipts as compared to the same calendar quarter of 2019. [§80604(a)(1)]
New Cryptocurrency Reporting Requirements
Amends the mandatory 60-day extension in I.R.C. §7508A(d) to clarify that the extension is mandatory, is not discretionary by the IRS, and does not require IRS action to apply. Effectively reverses the position taken by the IRS in recent regulations under §7508A(d). [§80501]
Amendments to 60-Day Mandatory Extension
Effective in 2024, cryptocurrency brokers will be required to file information returns reporting crypto transactions under I.R.C. §6045. Reporting will apply to digital assets acquired after 2022. [§80603]
Cryptocurrency will also be treated as “cash” for purposes of I.R.C. §6050I reporting of cash received by a business.
Additional Automatically Extended Act Deadline
Adds the filing of an appeal of a Tax Court decision to the list of acts that are extended under §7508(a)(1). [§80502]
Tax Court Filing Deadline Tolling
Tolls the deadline for filing a Tax Court petition where the court clerk’s office is closed or the e-filing portal is down to the date 14 days after the closure ends. [§80503]
Increased Extension Authority for IRS
The IRS will be permitted to grant discretionary extensions to certain deadlines under I.R.C. §7508A in the case of “significant fires” that trigger federal relief funds. [§80504]
Changes to Segment Rate Stabilization Tables
The bill delays the phase in of larger allowed fluctuations in certain interest rates used to determine pension plan funding requirements under I.R.C. §430(h)(2) from 2026 to 2031. [§80602]
New “Exempt Facility Bond” Provisions
Bonds issued by states that are used to fund projects by private businesses can qualify for the interest exemption in I.R.C. §103 in certain circumstances.
The bill adds “Qualified Broadband Projects” and “Carbon Dioxide Capture Facilities” to the list of allowable projects for these purposes and raises the normal limits on the size of the permitted issuance for those projects. [§80401, §80402]
Capital Contributions to Water and Sewerage Disposal Utilities
The bill provides special rules allowing certain water and sewage utilities to exclude as capital contributions certain amounts received from government entities or as aids to certain construction projects. [§80601]
Rescissions of Covid-Relief Appropriations [§90007]
- Rescinds $13.5 billion in unobligated Economic Injury Disaster Loan funds.
- Rescinds $17.578 billion in unobligated Economic Injury Disaster Loan Advances funds.
- Rescinds about $1.366 billion in unobligated Economic Stabilization Program funds.
- Rescinds about $5.676 billion in unobligated funds for the SBA’s loan programs.
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