The American Institute of Architects (AIA) states it was disappointed by the Senate Finance Committee’s proposal for reforming the tax code. As the committee marks up its legislation, the AIA noted that the proposal, like its companion piece in the House, still penalizes professional services companies, including architecture firms, organized as pass-through entities, in effect raising their taxes.
On a positive note, the Senate’s proposal retains the Historic Tax Credit, although it curtails its utility. The current 10 percent credit for pre-1936 structures is repealed, while the current 20 percent credit for certified historic structures is halved, to just 10 percent. This is an improvement on the House Ways & Means Committee proposal, but would still have an effect on historic rehabilitation projects. The Senate bill also eliminates tax incentives for energy efficient buildings.
Please attribute the following statement to AIA 2017 President Thomas Vonier, FAIA:
“Congress still has much to do if tax reforms are going to work for America’s communities and the architects who serve them. The Senate Finance Committee draft shows marginal improvements on the House Ways & Means Committee proposal from early November – for example, we’re happy to see the Senate keep at least some of the Historic Tax Credits. But their power to revitalize our decaying urban centers will be reduced, just when they can produce such strong benefits.
“There are other real issues. Tax incentives for energy efficient design and construction are eliminated, despite a record of producing buildings that are cleaner and less expensive to operate. Also, like the House proposal, the Senate draft excludes architects and other small business service professions from lowered tax rates – by name! There’s just no good public policy reason for this, especially when the design and construction sector is a catalyst for job growth.
“Our 92,000 members across the country are mobilized to make sure their Congressional delegations know these views. As the Senate Finance Committee marks-up its legislation, we want the amendment process to meet the three tests tax reform must achieve growth for small businesses; fair treatment of all taxpayers; and sustainable, resilient buildings and communities.”
1 Comment
There will always be things we don’t like about any bill. We should be not only concerned with the issues that affect us as design professionals directly but also the population at large.
1. I think the tax on pass-through services is unfair and should be fought. The AIA should use their influence to get this amended.
2. I am not as concerned about the tax credit for energy efficient design. There are already may tax incentives in the market place for encouraging responsible decisions on what to purchase and creating energy efficient designs. The bottom line is that if these designs save energy and money the purchaser of these goods and services ultimately get their reward. There is an incentive built into good investments. I’m not sure that all “energy efficient designs” are good investments and it comes at the expense of all tax payers that are already paying their share of taxes. Why should these owners and developers get tax credits paid for by the public that ultimately lead to their personal cost savings? Do not press this issue. Focus on the unfair taxes.