Washington insiders are now reporting that the B to the 4th might be dead on arrival. This, being the new administration’s first major domestic agenda, would be unusual given the administration’s control of both houses.
The primary obstacle to the bill has always been Sen. Joe Manchin III (D-W.Va.), who has a differing political view than the rest of his party. West Virginia is solidly Republican. In order for him to be re-elected, he must show his constituents that he’s fighting for them at every level.
His comments last week at a Wall Street journal event make passage of the bill almost a non-starter. His main concern is over-spending.
Senator Manchin stated that his party had reduced the cost of the bill by creating artificial expiration dates. Historically, those expiration dates are generally expanded, which would only add to an already blossoming deficit. He said that whatever plan he votes for would need to be based on a full ten years, without those sunsetting dates in the middle.
He’s also concerned about inflation. His average constituent drives 50 miles every day for work, making the price of gasoline a big part of his re-election hopes.
In addition, his voters are concerned about general inflation. If the BBB programs were made permanent, a CBO analysis shows that with inflation, it would add $3T to the deficit.
Given his long-standing political career and his need to be re-elected, this bill may be ancient history. If it is, the question becomes what will they do about tax law changes this year. B to the 4th included most of the changes for this year.
Timing is also a factor. If they don’t vote on this before the Christmas break, then nothing will be passed until maybe the middle of January. At that point, I wouldn’t get my tax software until Valentine’s Day, putting everything back at least three weeks.
We’ll see what happens. I’ll continue to write as this story progresses.
Let me leave you with this.
It’s the middle of December and time to think about next year. If you haven’t sent in your work through November, please do so today. The only way I can do reasonable tax planning is by having a solid November balance sheet in place.
If you would like for us to take over your payroll beginning next year, please contact us today. I need to get permissions at both the Federal and State levels to electronically run a payroll. This takes at least a couple of weeks to get everything in place.
If you are planning on bringing your accounting work to us for 2021, please contact us today. It’s easier for me to begin the process now, rather than in the middle of tax season.
We’re all going to get through this. Let’s get through it together.
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