Tax Bill Clears House, Senate and House Again. CRE Seen As Winner
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After bouncing back to the House Wednesday, the Republican tax bill passed both chambers of Congress and is heading to President Donald Trump’s desk for final approval.
The $1.5 trillion measure gives Trump his first legislative victory, slashes the corporate tax rate, adjusts the individual tax code for numerous tax brackets and is widely seen as a boon to commercial real estate professionals.
The House voted 227-203 in support of the bill Tuesday afternoon, sending it to the Senate. After three budgetary provisions in the bill violated Senate rules, the chamber was forced to vote on the measure again Wednesday afternoon. The Senate still held a vote very early Wednesday, voting 51-48 in favor shortly before 1 a.m., CNN reports. Arizona Sen. Jeff Flake was the final undeclared Republican and voted yes.
The House approved the final iteration of the bill just before 1 p.m. Wednesday in a 224-201 vote, as both chambers had to pass identical versions.
Trump is expected to have a 3 p.m. press conference at the White House. He tweeted a mixture of pride and admonishment of the media and Democratic Party over the course of the day.
The Tax Cuts are so large and so meaningful, and yet the Fake News is working overtime to follow the lead of their friends, the defeated Dems, and only demean. This is truly a case where the results will speak for themselves, starting very soon. Jobs, Jobs, Jobs!— Donald J. Trump (@realDonaldTrump) December 20, 2017
I would like to congratulate @SenateMajLdr on having done a fantastic job both strategically & politically on the passing in the Senate of the MASSIVE TAX CUT & Reform Bill. I could have not asked for a better or more talented partner. Our team will go onto many more VICTORIES!— Donald J. Trump (@realDonaldTrump) December 20, 2017
The tax overhaul includes a provision for limited liability companies, partnerships and other “pass-through” businesses that enables individuals making less than $157K and joint filers making less than $315K to take a 20% deduction on taxable income.
The bill also provides measures around a so-called safeguard, where taxpayers making more than the above-mentioned income levels can benefit by using a formula that takes into account property acquisitions in determining how much income qualifies for the deduction.
The measure gives real estate developers a hefty tax break. The tax bill also preserves the 1031 exchange, a provision used by developers to avoid capital gains taxes by reinvesting profits from a sale in new property.
The conservative-leaning Tax Foundation said the bill will add $516B to the federal deficit, while Congress' official deficit scorekeeper, the Joint Committee on Taxation, reported it would add $1 trillion to the deficit.