ABA Banking Journal
No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
SUBSCRIBE
ABA Banking Journal
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
No Result
View All Result
No Result
View All Result
ADVERTISEMENT
Home ABA Banking Journal

Congress Debates Significant Tax Changes

October 6, 2021
Reading Time: 2 mins read

By John Kinsella

As part of its budgetary process known as “reconciliation,” the House of Representatives has outlined a series of income tax proposals that could have a significant effect on banks and their customers. These include increases in the corporate tax rate to 26.5% for taxpayers with income over $5 million, the top individual rate to 39.6% for married taxpayers with income over $450,000 and the capital gains tax rate to 25% for taxpayers with income over $400,000.

In addition to the top individual tax rate hike, important changes could impact shareholders of banks that have elected S Corporation tax status, including a cap on the current 20% Section 199A deduction at $500,000 for married taxpayers and an expansion of the 3.8% net investment tax for owners who are active participants in the trade or business.

There is a laundry list of other changes in the proposals including enhancement to municipal finance, additional tax credits for housing, energy and community investment, as well as significant revisions in international taxation, to highlight a few.

Of particular importance to bank operations is a potential significant increase in required tax information reporting. The Biden administration has proposed that banks report annual gross inflows and outflows on all financial accounts flows that exceed $600. Amid the strong concerns that have been raised by customers and bankers on privacy, data security, and the ability of the IRS to store and use the massive amounts of new information, a significant and costly burden would be placed on customers and banks to operationalize this new requirement, both initially and on an ongoing basis.

ABA and a wide range of other trade associations have been working hard to have this proposal excluded from any final legislation. These efforts have been broad and included calling on bankers and customers to reach out to their congressional representatives (see below for ABA tools you can use).

Deliberations are continuing in Congress and the situation is very fluid as to agreement on what might be included in the legislation and related timing. In light of very narrow margins in both the House and Senate, it will be challenging to reach agreement. Importantly, all legislation must then be considered by the Senate and finalized before being sent to President Biden for his signature. There is still a long road to potential finalization. Stay tuned for much more to come.

Please contact John Kinsella for more information or to join ABA’s Taxation Committee.

Available tools include:

  • A copy of a recent letter to leaders of the House of Representatives.
  • ABA’s grassroots tools for bank customers.
  • Contact your lawmaker.

John Kinsella
ABA VP, Tax Policy

ADVERTISEMENT
Tags: CongressIRSTax reform
ShareTweetPin

Related Posts

New York Fed: Consumer inflation expectations mostly hold steady

New York Fed: Inflation expectations largely unchanged

Economy
July 8, 2025

Consumer inflation expectations in June ticked down at the short-term horizon but remained flat at the medium- and longer-term horizons, according to the most recent Survey of Consumer Expectations.

CPFB report claims health savings accounts have ‘hidden costs’

New HSA expansion included in federal budget bill

Human Resources
July 8, 2025

President Trump last week signed a budget bill that included the largest expansions to Health Savings Accounts since they were created in 2003.

Poll: Small business owners optimistic about the future

NFIB Small Business Optimism Index edged down in June

Economy
July 8, 2025

The Small Business Optimism Index declined by 0.2 of a point in June to 98.6, slightly above the 51-year average of 98. Of the 10 Optimism Index components, four increased, four decreased, and two remained unchanged.

The ever-expanding role of chief risk officer

The ever-expanding role of chief risk officer

Human Resources
July 7, 2025

'A new era has emerged in which CROs faced greater nonfinancial risk amid pressure to boost the bottom line.'

ABA, associations urge lawmakers to finalize deal on debt ceiling

Updated: President signs ‘big beautiful bill’ including numerous ABA-backed provisions

Ag Banking
July 3, 2025

Included in the bill were several ABA-supported tax provisions related to banks, including a modified version of the ABA-advocated ACRE Act and the permanent extension of the Section 199A pass-through deduction rate of 20%.

Factory orders increased in May

Factory orders increased in May

Economy
July 3, 2025

New orders for manufactured goods in May, up five of the last six months, increased $48.5 billion or 8.2% to $642.0 billion, the U.S. Census Bureau reported. This followed a 3.9% April decrease.

NEWSBYTES

Justice Department warns of scammers exploiting Texas floods

July 8, 2025

Business First to buy Progressive Bancorp in Louisiana

July 8, 2025

New York Fed: Inflation expectations largely unchanged

July 8, 2025

SPONSORED CONTENT

Navigating Disruption in Ag Lending – Why Tariffs Are Just the Tip of the Iceberg

Navigating Disruption in Ag Lending – Why Tariffs Are Just the Tip of the Iceberg

July 1, 2025
AI Compliance and Regulation: What Financial Institutions Need to Know

Unlocking Deposit Growth: How Financial Institutions Can Activate Data for Precision Cross-Sell

June 1, 2025
Choosing the Right Account Opening Platform: 10 Key Considerations for Long-Term Success

Choosing the Right Account Opening Platform: 10 Key Considerations for Long-Term Success

April 25, 2025
Outsourcing: Getting to Go/No-Go

Outsourcing: Getting to Go/No-Go

April 5, 2025

PODCASTS

Podcast: Inside ABA’s new Treasury Check Verification System API

June 25, 2025

Podcast: Staying close to clients amid tariff-driven volatility

June 18, 2025

Podcast: Old National’s Jim Ryan on the things that really matter

June 12, 2025
ADVERTISEMENT

American Bankers Association
1333 New Hampshire Ave NW
Washington, DC 20036
1-800-BANKERS (800-226-5377)
www.aba.com
About ABA
Privacy Policy
Contact ABA

ABA Banking Journal
About ABA Banking Journal
Media Kit
Advertising
Subscribe

© 2025 American Bankers Association. All rights reserved.

No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive

© 2025 American Bankers Association. All rights reserved.