President Biden Signed The Inflation Reduction Act (IRA). Now, it is the law!
The bill’s passage was many months in the making and at times appeared unlikely with a 50-50 Senate and midterm elections fast approaching. It accomplishes long-held Democratic goals of lowering prescription drug costs, investing in transitions to clean energy, and reforming the nation’s tax code.
Key Areas:
- Introduce a Corporate minimum tax rate of 15% for profits over $1B
- Expand the COVID relief for ACA premiums until 2025
- Increase cleaner production and reduce carbon emissions by roughly 40% by 2030
- Increase IRS funding by $80B to expand the audit rate
- Lower Medicare & pocket drug costs
What’s the impact of this?
- Your previous tax planning strategies may no longer offer the same incentives (i.e., Oil & Gas Investments)
- If your gross income is above 400k per year, you may see an increase in your taxes in the coming year.
- It will also limit out-of-pocket drug expenses for seniors on Medicare to $2,000 annually and allow Medicare to negotiate with drugmakers on prescription prices.
- Provides $80 billion in funding to the IRS, allowing the agency to hire thousands of agents and revamp decades-old technological systems.
- The new law provides $369 billion to fund energy and climate projects to reduce carbon emissions by 40% in 2030.
Let’s discuss your proactive tax planning options. Book your free consultation here: