Positive Tax Changes to Anticipate from AICPA’s Proposal to Congress

The AICPA proposed several tax changes in the Internal Revenue Code to the Congress. The proposals focused on improving tax management, making the tax code more impartial, and more.

Internal Revenue Code [Photo: Investopedia]

According to Waggoner, the list of changes began with standardizing the definitions of terms so they would be consistent throughout the Code. The AICPA suggests that existing terms in the Code that have several definitions must be standardized. Nonetheless, if it can be justified how a term has different definitions, then the terms must have different names to avoid confusion.

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Other Tax Changes in the Proposal

According to Cohn, another one of the tax changes is the Amend Section 62(a)(1). This change must allow the deduction of all state and local taxes. The taxes include income, sales, and property taxes. Furthermore, these taxes must come from or be accredited to any deductible business or trade under Section 62(a)(1).

In addition, the tax changes must offer permanent and equal provisions to help taxpayers during disaster relief. In this proposal, there are 11 permanent changes that are recommended. These include inflation-adjusted disaster relief. This relief must be immediately effective once assistance is accessible in a disaster declaration area. It must also provide an employee retention credit for businesses with certain damages caused by a disaster,

Lastly, the tax changes must coordinate and clarify provisions related to education. In this proposal, there are 5 changes that are recommended. These include changing the tax incentives with a new credit to help taxpayers afford higher education expenses.

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