Comparison of House, Senate and Conference Committee Approved Tax Reform Bills

Updated December 22, 2017

PDF of the Comparison of House and Senate Approved Tax Reform Bills

Information listed in the Conference Report column is based on press reports and is subject to change. 

 

Former Law

House

Senate

New Law

Volume Cap Low-Income Housing Tax Credits (LIHTC)

$2.35 per capita/$2.71 million small state minimum (2017)

RetainedRetainedRetained
Private Activity Bonds (PAB)

$100 per capita/$305 million small state minimum (2017)

All PAB, including residential rental, REPEALED after 2017All PAB, including residential rental, Retained

All PAB, including residential rental, Retained

4 Percent PAB LIHTC

$3-4 billion a year 4 percent PAB LIHTC

 

4 percent PAB LIHTC REPEALED  after 2017
4 percent PAB LIHTC Retained4 percent PAB
LIHTC retained
LIHTC BasisMaximum basis boost = 30 percentNo changesBasis boost REDUCED to 25 percent, if PIS after date of enactment, rural developments qualify for 25 percent basis boostNo changes
LIHTC-General Public Use RequirementNo changesNo changesArtist housing safe harbor REPEALED for existing and future housing, Veterans housing exception enacted No changes
New Markets Tax Credit (NMTC)

$3.5 billion annual allocation for 2018 and 2019, 39 percent credit, slated to expire after 2019

2017 round retained,
2018 and 2019 rounds REPEALED
2017, 2018 and 2019 rounds retained2017, 2018 and 2019 rounds retained
Investing in Opportunity ActNo provisionNo provisionCreates new incentive to invest capital gains in low-income communitiesCreates new incentive to invest capital gains in low-income communities
Historic Rehabilitation Tax Credit (HTC)

20 percent credit claimed when certified historic property is placed in service

Subject to transition rules, REPEALED after 201720 percent credit retained, but claimed over 5 years, after 2017, subject to transition rules20 percent credit retained, but claimed over 5 years, after 2017, subject to transition rules
Non-Historic Rehabilitation Tax Credit

10 percent credit, for nonresidential buildings placed in service before 1936

 

REPEALED after 2017 subject to transition rulesREPEALED after 2017 subject to transition rulesREPEALED after 2017 subject to transition rules
Renewable Energy Investment Tax Credit (ITC)

30 percent ITC, phases down after 2019,
10 percent ITC - "Permanent"

30 percent ITC, phase down after 2019 retained

10 percent ITC REPEALED

30 percent ITC, phase down after 2019 retained,

10 percent ITC retained

30 percent ITC, phase down after 2019 retained,

10 percent ITC retained

Orphan Renewable Energy Technologies

ITC "Orphan" Renewable Energy Technologies expired after 2016

ITC extended for "Orphan" Renewable Energy Technologies as per current 30 percent ITC phase down scheduleITC "Orphan" Renewable Energy Technologies remain expiredITC "Orphan" Renewable Energy Technologies remain expired
Renewable Energy Production Tax Credit (PTC)

PTC phase down starting after 2016, PTC @ 2.4 cents per kWh

PTC phase down starting after 2016, REDUCED to 1.5 cents per kWh

PTC phase down starting after 2016, PTC @ 2.4 cents per kWh retained

PTC phase down starting after 2016, PTC @ 2.4 cents per kWh retained
PTC Continuous Construction Requirement

No continuous construction requirement for projects completed by 2020

 

Continuous construction requirement REQUIRED for projects placed in service after 2017No continuous construction requirement for projects completed by 2020 retainedNo continuous construction requirement for projects completed by 2020 retained
Corporate Rate

Top corporate rate of 35 percent

Top corporate rate of 20 percent tax years beginning after Dec. 31, 2017Top corporate rate of 20 percent tax years beginning after Dec. 31, 2018Top corporate rate of 21 percent tax years beginning after Dec. 31, 2017
Business Income Taxation (Individuals) (Pass-throughs and Schedule C)

Subject to individual income tax rates

 

Business income tax rate of 25 percent,
business income presumption of 30 percent 
Individuals may deduct 23 percent of qualified business income (until Dec. 31, 2025)Individuals may generally deduct 20 percent of qualified business income (until Dec. 31, 2025)
Business Interest Expense Deduction 

No limit

Limited to 30 percent of business adjusted taxable income, real estate businesses exemptedLimited to 30 percent of business adjusted taxable income, real estate businesses can elect outLimited to 30 percent of business adjusted taxable income, real estate businesses can elect out
Expensing 

50 percent bonus depreciation, phased down through 2019 for new property

 

100 percent expensing for new and used property investments made after Sept. 27, 2017, through Dec. 31, 2022, buildings not eligible, real estate businesses not eligible

100 percent expensing for new property investments made after Sept. 27, 2017, 
through Dec. 31, 2022, phases down through Dec. 31, 2026, buildings not eligible,
real estate businesses are eligible
100 percent expensing for new and used property investments made after Sept. 27, 2017, through Dec. 31, 2022, phases down through Dec. 31, 2026, buildings not eligible, real estate businesses are eligible
Property Depreciation 

Modified Accelerated Cost Recovery System (MACRS):
residential rental real property - 27.5 years, 
site improvements – 15 years,
personal property – 5 years,

Alternative Depreciation System (ADS): real property – 40 years

No Changes

MACRS - Residential and nonresidential real property depreciation life reduced to 25 years

ADS 30 year cost recovery for real property if elect out of business interest expense  deduction limitations

MACRS – Residential and nonresidential real property depreciation life unchanged.

ADS 30 year for residential and 40 year for nonresidential real property if elect out of business interest expense deduction limitations

Interest Deductibility 

No limit

ADS – 40 year cost recovery for real property

See interest expense deduction

ADS – 40 year cost recovery for real property

Real estate businesses can elect out of limitation on interest deductibility.

But, ADS as modified to 30 year cost recovery for real property would apply.

Real estate businesses can elect out of limitation on interest deductibility.

But, ADS as modified to 30 year cost recovery for residential real property and 40 year cost recovery for nonresidential real property would apply

Inflation Factor

Consumer Price Index for all Urban Consumers
(CPI-U)

Changes to “chained CPI,” 
future 9 percent LIHTC allocations REDUCED
Changes to “chained CPI,” 
future 9 percent LIHTC allocations and volume cap for tax-exempt private activity bonds REDUCED
Changes to “chained CPI,” 
future 9 percent LIHTC allocations and volume cap for tax-exempt private activity bonds REDUCED
Base Erosion and Anti-Abuse Tax (BEAT)N/AN/A

10 percent/12.5 percent tax rate;

LIHTC, NMTC, HTC, ITC and PTC Do Not Offset BEAT

5-6 percent - 2018, 10-11 percent – 2019-2025, then 12.5-13.5 percent tax rate after 2025

Corporations generally benefit from at least 80
percent of LIHTC, ITC, and PTC until 2026.

NMTC and HTC cannot offset BEAT liability

Alternative Minimum Tax

20 percent for corporations

28 percent for individuals

Repealed for corporations and individuals

 

RETAINED for corporations;

Increased exemption and phase-out thresholds for individuals until Dec. 31, 2025

Note:  LIHTC, HTC and ITC can be taken against AMT liability, but NMTC and years 5 through 10 of PTC cannot

Repealed for corporations;

Increased exemption and phase-out thresholds for individuals until Dec. 31, 2025

Note:  LIHTC, HTC and ITC can be taken against AMT liability, but NMTC and years 5 through 10 of PTC cannot