Inflation Reduction Act Changes

August 26, 2022
The Inflation Reduction Act was just recently approved by President Biden. The bill will help cap and lower the price of medication for seniors in part by allowing Medicare to negotiate drug prices for the first time. A large part of the bill’s funds will go to energy and climate provisions, including tax credits for electric vehicles and incentives for clean-energy projects. The new legislation will provide the IRS with an increase in funding of $80 Billion over the next ten years, which will help pay for more IRS agents to increase the audit rate for those earning more than $400,000 annually. Another change is a 15% minimum tax which may penalize companies for using tax deductions that were originally designed to incentivize corporations to invest in their companies. Additionally, the legislation imposes a 1% excise tax on the repurchase of stock by publicly traded companies. These changes could affect stock valuations or lead to increases in the prices of goods and services.

To learn more about the Inflation Reduction Act, please read ThinkAdvisor’s

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