On December 11, 2021 Senate Finance Committee Chairman Ron Wyden (D-OR) released draft amendments to the “Build Back Better Act”, which is currently under consideration in the Senate after being approved by the House of Representatives in November.
Senator Wyden stated that the Senate Finance Committee’s modifications include “both technical and policy changes, as well as modifications to comply with Senate budget rules.” Interestingly, the Senate amendments do not increase the corporate, personal, or capital gains tax rates.
With respect to international tax provisions, the Senate amendments include a taxpayer-favorable section 163(n) election to use adjusted basis (rather than EBITDA) in determining net interest expense. On the other hand, the Senate amendments broaden the application of the anti-inversion rules under section 7874 (which the House version did not address at all) and limit the availability of the section 245A dividends received deduction.
In terms of timing, Senate Majority Leader Chuck Schumer (D-NY) stated that he wants voting on the amendments to begin this week. But given that Senator Joe Manchin (D-WV) has expressed both general and specific concerns regarding the House version of the bill, it seems more likely that Senate voting may come later this month or early next year.