Tax Relief for American Families and Workers Act of 2024 stalled in Senate

OPINION:

Time is running out for Congress to pass tax relief for American families and businesses.

With less than a month to go until Tax Day, the Tax Relief for American Families and Workers Act of 2024 — which passed the House by a comfortable bipartisan margin of 357-70 — is stalled in the Senate.

It is absolutely imperative that Congress pass this bill, which will increase the child tax credit and allow immediate expensing of research and development expenses for businesses.

American businesses are operating at a competitive disadvantage compared with the rest of the world. Over the past few years, numerous provisions of the Tax Cuts and Jobs Act have been gradually phased out, resulting in a de facto tax increase for our businesses.

At the same time, other countries have moved to make immediate R&D expensing a permanent feature of their tax codes. China, our greatest economic rival, even allows companies to deduct 200% of eligible R&D expenses in addition to actual R&D expenses. Britain recently made full and immediate expensing a permanent part of its tax code. American companies are being left behind.

The Tax Relief for American Families and Workers Act would go a long way toward restoring competitive balance. It’s not a perfect bill, but it’s a definite improvement over the status quo. More importantly, it’s our last chance for meaningful tax reform until the winners of the November election take office in January — 10 whole months from now.

Right now, small businesses all over the country are holding off on filing their tax returns, hoping for a last-minute deal in the Senate to pass this commonsense, bipartisan tax relief bill. Meanwhile, they are being forced to choose between taking out high-interest loans, laying off workers, or canceling potentially lucrative research projects in order to afford their increasing tax bills.

Uncertainty is bad for business. Business owners — especially small-business owners — need to know from one year to the next what their tax rates are and which tax credits will be available to them. The political gamesmanship in Congress is creating unnecessary burdens for American job creators.

This bill should be a slam-dunk. We already know that the Tax Cuts and Jobs Act, which included full and immediate R&D expensing, led to increased tax revenue by encouraging new investment. We also know that families are struggling with the burden of high inflation, and that millions of families would benefit from increasing the child tax credit.

Unfortunately, politics is again getting in the way of doing what’s right for Americans. I’ve been working the phones, trying to convince holdout senators that this bill deserves a vote. At this point, I’m convinced that the only way to overcome the resistance is for voters to make their voices heard.

Small businesses account for almost half of all employment in this country. If you work for a small or medium-sized business, this bill will make it easier for your employer to offer promotions and raises. If you’re a parent — especially if you’re on the lower end of the income scale or have multiple children — then this bill will likely mean more money in your pocket (and don’t worry if you’ve already filed, because the IRS has already stated that it will retroactively apply the bill’s child tax credit expansion for early filers, if it passes).

HR 7024 is a perfect example of bipartisan problem-solving in action. Both sides are giving up a little but getting a whole lot more. It’s a net positive for American families, American businesses and the American economy. Moreover, since the deal originated in Congress, it doesn’t have any bearing on presidential election politics — an important consideration in this contentious election season.

The clock is ticking. Families and businesses are waiting with bated breath for Congress to pass this bipartisan tax relief bill.

• Julio Gonzalez is the CEO and founder of Engineered Tax Services Inc.