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The overwhelming majority of construction businesses are organized as pass-through entities, meaning that their income is taxed at the individual level. These job-creating small and medium-sized businesses would bear the brunt of higher marginal tax rates, wealth surcharges, and corporate-only attempts to reform or alter the code.

Prevailing Wage’s Impact on Affordable Housing

The New York Independent Budget Office (IBO) has released a revised report on the impact prevailing wage requirements would have on affordable housing projects built with the 421a property tax break. The 421a tax credit had been the subject of extensive negotiations in the past months. In Jan. 2016, the parties involved announced they could not reach a compromise, killing the tax credit and jeopardizing Mayor de Blasio’s plans for 80,000 affordable housing units for New York City residents. 

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Small Business Tax Relief

The overwhelming majority of construction businesses are organized as pass-through entities, meaning that their income is taxed at the individual level. These job-creating small and medium-sized businesses would bear the brunt of higher marginal tax rates, wealth surcharges, and corporate-only attempts to reform the code.

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U.S. House of Representatives and Senate Reach Deal on Omnibus, Tax Extenders

The U.S. House of Representatives and U.S. Senate have reached a deal on both the Omnibus spending package and extending certain expired tax provisions commonly referred to as “extenders.”

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Tax Season Reminds Construction Industry of High Effective Rates

Many ABC members were greeted with a significant tax increase this tax day, April 15. Construction contractors who survived the recession already paid the highest effective tax rate of any sector, and now they face even higher taxes thanks to rising marginal rates, reinstated limits on deductions, and new surtaxes on wages and income stemming from the health care law.

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Tax Proposal Would Lower Construction Tax Rate to 25 Percent

U.S. House of Representatives Ways and Means Committee Chairman Dave Camp (R-MI) Feb. 26 released a draft of legislation designed to reform the tax code that proposes lowering the top tax rate for construction businesses from 35 percent and 39.6 percent to 25 percent, regardless of entity-level structure. The proposal confirms that the 25 percent Qualified Domestic Manufacturing Income (QDMI) rate would apply to “construction of real property in the United States as part of the active conduct of a construction trade or business.”

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The American Job Builders Tax Reform Act

Under current law, construction contractors cannot use the completed contract method (CCM) of accounting if average annual gross receipts exceed $10 million, which has not been adjusted for inflation since 1986. H.R. 1993 would increase the threshold to $40 million and would index the threshold for inflation. Adjusting this threshold for inflation would allow more than 90 percent of ABC members that are small businesses to utilize CCM.

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Estate Tax Repeal

When the owner of a construction company dies, the value of the company is added to the owner’s estate and is taxed after exemptions. The estate tax, also known as the “death tax,” places a significant burden on future generations of family business owners, as well as their employees, customers and suppliers.

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ABC and Coalition Support Bill to Repeal the Death Tax

ABC, as part of the Family Business Estate Tax Coalition (FBETC), June 19 supported the Death Tax Repeal Act of 2013 (S. 1183/H.R. 2429) that would permanently repeal the estate tax.

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ABC and Coalition Call on Congress to Stop Scheduled Estate Tax Hike

As part of the Family Business Estate Tax coalition (FBETC), ABC Nov. 15 sent a letter to members of Congress urging them to pass legislation addressing the estate tax before the end of the year. Barring congressional intervention, the resurgent estate tax rate and diminished exemption would saddle thousands of family-owned businesses with a crippling tax increase.

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ABC Urges Congressional Task Force to Advance Common-sense Health Care Solutions

On April 28, ABC submitted a letter to the chairmen of the congressional Task Force on Health Care Reform urging them to take action on common-sense health care solutions.  In the letter, ABC expressed its strong support for the task force’s mission to “modernize American health care with a patient-centered system that gives patients more choice and control, increases quality, and reduces costs.”

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ABC Joins Letter Urging Action on Small Business Healthcare Bill

On April 12, ABC joined more than 60 national and multi-state organizations across the country in sending a letter  to members of the House Committee on Ways and Means urging them to take action on the Small Business Healthcare Relief Act (H.R. 2911 ).  The bill would allow small businesses that have fewer than 50 employees to offer employer payment plans and Health Reimbursement Arrangements (HRAs) to employees for the payment of premiums or qualified medical expenses associated with insurance coverage.

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President Obama Vetoes Legislation to Rollback Harmful ACA Provisions

The U.S. House of Representatives passed an amended version of the Restoring Americans’ Healthcare Freedom Reconciliation Act (H.R. 3762) Jan. 6, which would repeal several, job-killing provisions in the Affordable Care Act. The same version of the bill passed the Senate 52-47 in Dec. 2015.

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ABC Comments on EEOC’s Proposed Revisions to the EEO-1 Report

On April 1, ABC submitted comments in response to the U.S. Equal Employment Opportunity Commission’s (EEOC) proposed revisions to the Employer Information Report (EEO-1), which would require employers with 100 or more employees to provide data on W-2 pay and hours worked, beginning in 2017. ABC urged the EEOC to withdraw the proposal because it imposes an unjustified burden on employers, fails to generate useful and reliable information to combat pay discrimination, and fails to protect the confidentiality of the information. 

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Legislation Seeks to Repeal IC "Safe Harbor Provision"

In the 111th Congress, Representative Jim McDermott D-WA) introduced the Taxpayer Responsibility, Accountability, and Consistency Act of 2009 (H.R. 3408) and Senator John Kerry (D-MA) introduced the Senate companion bill, S. 2882. Both H.R. 3408/S. 2882 seeks to repeal Section 530 of the Revenue Act of 1978, a safe-harbor provision that protects qualifying taxpayers against the Internal Revenue Service reclassifying covered workers as employees for federal employment tax purposes.

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Independent Contractor Reform

ABC supports preservation of Section 530. Attempts to repeal it will place uncertainty and new overhead in front of entrepreneurship, with the heaviest burdens falling on the low-capital start-ups from which many successful small businesses originate.

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1099 Reporting Requirement

In a victory for merit shop construction and businesses nationwide, the expanded 1099 tax reporting requirements included in  the Patient Protection and Affordable Care Act were repealed April 14 when President Obama signed into law the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011 (H.R. 4).

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Three Percent Witholding

In November of 2011, Congress unanimously passed ABC-supported legislation to repeal Section 511 and its withholding mandate, culminating five years of hard work by ABC and its coalition partners.

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