Tax Relief for American Families and Workers Act of 2024

Summary · Congressional Research Service (nonpartisan)

Tax Relief for American Families and Workers Act of 2024 TITLE I--TAX RELIEF FOR WORKING FAMILIES This title modifies the calculation of the refundable portion of the child tax credit to require the multiplication of the credit amount in calendar years 2023-2025 by the number of qualifying children. The maximum refundable amount per child of such credit is increased to $1,800 in 2023, $1,900 in 2024, and $2,000 in 2025, with an inflation adjustment beginning after 2023. The title allows taxpayers to elect in 2024 and 2025 to use prior year earned income in calculating their earned income tax credit TITLE II--AMERICAN INNOVATION AND GROWTH This title allows taxpayers to delay the date on which they must begin deducting their domestic research or experimental research costs over a five-year period until 2026. Taxpayers may therefore expense such costs incurred between 2022-2026. The title extends the allowance for depreciation, amortization, or depletion in determining the limitation of the business interest deduction. It also extends 100% bonus depreciation and increases the limitations on expensing of depreciable business assets. TITLE III--INCREASING GLOBAL COMPETITIVENESS Subtitle A--United States-Taiwan Expedited Double-Tax Relief Act United States-Taiwan Expedited Double-Tax Relief Act This subtitle sets forth special rules for the taxation of certain residents of Taiwan, including rules for the reduction of withholding taxes, the application of permanent establishment rules, the treatment of income from employment, and the determination of Taiwanese residency, including rules for dual residents. Subtitle B--United States-Taiwan Tax Agreement Authorization Act United States-Taiwan Tax Agreement Authorization Act This subtitle grants the President authority to negotiate and enter into a U.S.-Taiwan tax agreement after the tax provisions of this title are enacted and effective. TITLE IV--ASSISTANCE FOR DISASTER-IMPACTED COMMUNITIES Federal Disaster Tax Relief Act of 2024 This title excludes from gross income, for income tax purposes, compensation for losses or damages due to certain wildfires. It applies only to payments received by a taxpayer after 2019 and before 2026. The title also excludes payment for compensation for losses or damages from the derailment of a train in East Palestine, Ohio, on February 3, 2023. TITLE V--MORE AFFORDABLE HOUSING This title increases the low-income housing tax credit ceiling to 12.5% for calendar years 2023-2025. It also lowers the bond-financing threshold to 30% for projects financed by bonds issued before 2026. TITLE VI--TAX ADMINISTRATION AND ELIMINATING FRAUD This title increases the threshold for reporting income earned by an independent contractor from $600 to $1,000, with an adjustment to the increased amount for inflation. The title increases penalties for aiding and abetting the understatement of tax liability with respect to the COVID-related employee retention tax credit.