On August 8th, 2022, the Senate approved bill H.R. 5376, the Inflation Reduction Act of 2022. This bill will make a historic down payment on deficit reduction to fight inflation, invest in domestic energy production and manufacturing, and reduce carbon emissions by 40 percent by 2030. In addition, the bill will allow Medicare to negotiate prescription drug prices and extend the expanded Affordable Care Act Program (ACA) for three years.
While Democrats and supporters of the legislation believe it would lower health care costs, prescription drugs, and energy costs, and make the U.S. tax code fairer, others disagree. Individuals argue that the new spending would further aggravate inflation and stifle growth. While the bill must still pass in the House of Representatives and be signed by President Joe Biden, it’s more than likely to become a law.
What This Means For Small Business Owners
To stay compliant, small business owners must keep up with changing laws and regulations. Following the passing of the Inflation Reduction Act, it’s important to understand the following provisions:
- 15% minimum tax on corporations with over $1 billion in revenue
- 1% excise tax on corporate share buybacks
- $80 billion more in IRS enforcement
The following are health care provisions:
- Extend the ACA subsidies through 2025
- Allow Medicare to negotiate drug prices, starting with 10 drugs in 2026
- Cap Medicare recipients' drug expenditures at $2,000 per year
Uncertainties Relieved Through GMS
Despite the uncertainty surrounding the new Senate bill, GMS experts are ready to help your small business. We provide you with resources and guidance to get you through unprecedented times. Our benefits services allow your business to offer competitive, cost-effective benefits such as health insurance while you focus on what you do best. Get back to focusing on what's important, your business. Contact us today.