A significant piece of tax legislation was rejected by the US Senate last week even though it passed overwhelmingly by the US House in January 2024. This decision can impact both families and businesses, so we wanted to break down what it means for each. 

What Was in the Bill?

• Child Tax Credit Expansion: The bill sought to increase the amount of the child tax credit and potentially expand eligibility to families that did not qualify before. 
• Business Tax Breaks: The bill proposed to restore tax deductions and credits, including for equipment, interest costs, and research and development activities. These were not new breaks, but ones that had lapsed. 

Impact on Dental Practices and Families

• For Families: The proposed child tax credit expansion will not go into effect. Those that currently qualify can still take advantage of the credit, but it will not be expanded to cover more families. 
• For Dental Practices: For those that anticipated more easily writing off 100% of the cost of new equipment in the first year, that is now off the table. You will need to continue operating under the existing tax framework. 

Optimize Your Tax Situation

While this may not have been the outcome some had hoped for, there are still plenty of ways to take advantage of existing laws. There are myriad other tax credits and deductions for which both families and businesses may still qualify. We encourage all of our clients to take advantage of early tax planning so we can determine which ones will help lower your overall tax liabilities and optimize your tax strategy for this year and the future as well. 

Proactive tax planning is one of the keys to financial success, regardless of legislative changes. Reach out to us with questions or to schedule a consultation.