Tax

Webinars on the One Big Beautiful Bill

»Æ¹ÏÊÓƵ Supports Tax Policies that Promote Business Investment, Development, and Expansion

• For contractors, high income taxes— whether corporate or individual—reduce a company’s cash flow, thereby reducing the amount of money available to these businesses to expand, purchase equipment, hire more workers, bid on future projects, and reduce debt. »Æ¹ÏÊÓƵ supports keeping the federal tax burden on individuals, construction companies, and other businesses low as a means of promoting investment, business development, and business expansion. High marginal and effective tax rates inhibit entrepreneurial activity by penalizing successful businesses.
   
• Prior to passage of the Tax Cuts and Jobs Act (TCJA), the construction industry faced the highest effective tax rate of any industry, at 31 percent, according to a 2016 study from the Department of the Treasury, Office of Tax Analysis.  While the Tax Cuts and Jobs Act reduced tax rates for construction businesses, the industry continues to pay a high effective tax rate relative to other industries; any changes to the tax rates disproportionately affects construction firms.
   
• »Æ¹ÏÊÓƵ supported passage of the TCJA and One Big Beautiful Bill Act(OBBBA).  The bills reduced tax rates for corporations and pass-through businesses, simplified tax accounting for construction businesses, repealed the corporate alternative minimum tax (AMT) and significantly reduced the impact of the individual AMT.
   
• The majority of construction firms (more than 70 percent) are organized as pass-through businesses, such as S-Corporations, partnerships, LLC’s and sole proprietorships, meaning they do not pay the corporate tax rate, and are instead taxed at the owners’ individual tax rate.
   
• The tax code includes a number of provisions that promote infrastructure investment and construction jobs, which »Æ¹ÏÊÓƵ strongly supports.

»Æ¹ÏÊÓƵ Message

• »Æ¹ÏÊÓƵ supported passage of the TCJA and OBBBA.  While the bills improved the tax code in many important ways, the construction industry needs additional changes. The following remain top »Æ¹ÏÊÓƵ legislative priorities.
   
  • Repeal the Alternative Minimum Tax (AMT). The AMT creates needless complexity and is a stealth tax increase on many construction businesses.
     
  • Repeal the Estate Tax. The TCJA increased the estate tax exemption from $5 million to $10 million and OBBBA increased it to $15 million permanently. While »Æ¹ÏÊÓƵ supports making this important estate tax relief permanent, a better outcome would be full repeal of the estate tax, which can force family-owned businesses to divert scarce resources and capital away from the business and into expensive estate planning. 
     
  • Promote Infrastructure Investment in the Tax Code. »Æ¹ÏÊÓƵ supports the expansion of the private-activity bond (PAB) cap to allow for additional investment in highways and utilities, and also include additional types of public infrastructure, such as public buildings like schools, hospitals and courthouses.