The U.S. House of Representatives Ways and Means Committee passed H.R. 7024, the Tax Relief for American Families and Workers Act of 2024. The bipartisan legislation allows for immediate expensing of research and development (R&D) and investments in equipment, reduces reporting for small businesses using subcontractors, increases the small business expensing cap by nearly 30% and expands the Child Tax Credit.

The legislation now awaits consideration on the floor of the U.S. House of Representatives. 

PRI members and manufacturing businesses can benefit from the following parts of the legislation: 

• Research & development (R&D) expensing: Businesses of all sizes can immediately deduct the cost of their U.S.-based R&D investments instead of over five years, encouraging American innovation and improving our competitive position versus China and the rest of the world. 
• Interest deductibility: Continued flexibility for businesses forced to borrow at higher interest rates to meet their payroll obligations and expand their operations. 
• 100% expensing: Restore full and immediate expensing for investments in machines, equipment and vehicles. 
• Expand small business expensing cap: Increase the amount of investment that a small business can immediately write off to $1.29 million, an increase above the $1 million cap enacted in 2017. 
• Cut red tape for small businesses: Adjust the reporting threshold for businesses that use subcontract labor from $600 to $1,000 and index for inflation, the first update to the threshold since the 1950s. 

"American families will benefit from this bipartisan agreement that provides greater tax relief, strengthens Main Street businesses, boosts our competitiveness with China and creates jobs. We even provide disaster relief and cut red tape for small businesses, while ending a COVID-era program that's costing taxpayers billions in fraud," said House Ways and Means Committee Chairman Jason Smith (MO-08). "This legislation locks in over $600 billion in proven pro-growth, pro-America tax policies with key provisions that support over 21 million jobs. I look forward to working with my colleagues to pass this legislation." 

Read the section by section for more information on this comprehensive tax package. Last June, the PRI Washington, D.C., office reported on the Tax Cuts for Working Families Act (H.R. 3936), the Small Business Jobs Act (H.R. 3937) and the Build It in America Act (H.R. 3938) passing the House Ways & Means Committee. Read an in-depth analysis of the key provisions. 

SEMA and PRI, together with over 260 organizations, signed the National Association of Manufacturers' letter to U.S. House and Senate leadership in support of the Tax Relief for American Families and Workers Act of 2024. Click here to read the letter. 

For more information, contact Tiffany Cipoletti at tiffanyc@sema.org.