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Member Notice: Your Input Requested on House and Senate-Passed Versions of Tax Reform Bill

Friday, December 8, 2017   (0 Comments)
Posted by: Luisa Guerra

Dear SBIA Members:

This week the House and Senate formally voted to go to conference on the "Tax Cut and Jobs Act," which means that this significant legislation is much closer to becoming permanent law.

We strongly encourage you to read the side-by-side comparison of both versions of the bill, forward the comparison to your Limited Partners and Portfolio Companies, and reach out to us with comments so that we can create a much fuller picture of how tax reform will affect us and the industry at large.

  • A side-by-side of the House and Senate-passed versions of the tax reform bill is available here.

The two bills have very significant differences, including the treatment of: individual income tax rates, the state and local tax (SALT) deduction, and the Senate bill's corporate Alternative Minimum Tax (AMT), a high-profile issue.

The committee also needs to resolve differences in the House and Senate bills regarding interest deductibility. The House bill: 1) uses Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) to compute adjusted taxable income for purposes of applying the 30% limitation to the businesses interest expense deduction and 2) exempts any business with average annual gross receipts of $25 million or less from any limitation on interest deductibility. The Senate bill sets $15 million as the threshold, while only using EBIT (removing Debt and Amortization from the calculation) to compute adjusted taxable income.

Again, please take the time to read through the comparison and reach out to us so that we can more fully understand how this significant legislation will affect your portfolios.

Sincerely,

Will Gardner
Manager, Government Affairs
Small Business Investor Alliance

 


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