Optimism is rising that Congress will approve a bipartisan tax deal that includes an expansion of the child tax credit along with business breaks, including for research and development, with a vote in the House of Representatives possible as soon as next week.
“We see a 55%-65% probability that Congress will enact a tax bill,
including extension of the R&D tax credit,” Benjamin Salisbury of Height Capital Markets wrote in a note. “The credit is a priority for industries including pharma
aerospace & defense
The child tax credit would become more generous, with millions of kids set to benefit, as MarketWatch’s Andrew Keshner has reported — although the deal would not revive a version from a few years ago.
See: Bipartisan deal could boost the child tax credit — but wouldn’t bring back the generous 2021 version. Here’s what it would mean for your taxes.
Should the House pass the deal, that move combined with lobbying from the business community would put “significant pressure on the Senate to pass the legislation,” Beacon Policy Advisors wrote in a note on Thursday.
There is some skepticism among senators, Beacon noted, including from Mike Crapo of Idaho, the top Republican on the Senate Finance Committee.
“Still, Crapo and some of his GOP colleagues could come around on the bill if they are given a chance to amend it,” the note said.
The agreement, formally called the Tax Relief for American Families and Workers Act of 2024, would also boost the low-income-housing tax credit that incentivizes developers to build new affordable-housing units.
Now read: Bipartisan tax deal could lead to 200,000 new affordable rental units. It’s a ‘modest and important’ effort, expert says.
Salisbury cautions that action in the House could face some challenges, including from conservatives over progressive priorities and over the absence of the State and Local Tax deduction, or SALT, from the deal. In addition, changes demanded by senators could require a second vote in the House.