By Zachary Halaschak, Washington Examiner | SOURCE: THE GAZETTE
The $78 billion bipartisan proposal that would expand the child tax credit and renew key business investment deductions is meant to be fully paid for — here is how.
The House Ways and Means Committee advanced the bipartisan bill on Friday in an overwhelming 40-3 vote, moving it one step closer to becoming law. The legislation enhances the child tax credit while restoring some major business tax provisions and would pay for it through changes to the pandemic-era employee retention tax credit, or ERC.
The $78 billion bill, which came after weeks of negotiations, would be offset by stronger enforcement and penalties tied to fraudulent ERC claims and would bring an early end to the processing of claims. The Joint Committee on Taxation, Congress’s in-house tax scorekeeper, estimates that the ERC changes would result in just over $77 billion in savings, making the overall bill deficit-neutral.
What is the employee retention tax credit?