Broker Check

General Tax Provisions of the Infrastructure Investment and Jobs Act

November 09, 2021

The Build Back Better (BBB) proposals have changed in the House since the original House proposals. In fact, the BBB has changed even since President Biden offered his BBB framework. At this juncture, it’s not entirely clear whether a BBB can be passed. A BBB bill will in all likelihood pass at some point, however, there are too many divergent positions among the President, Senate, House, Progressive Caucus, House moderates, etc. to speculate on what will be includible in a final bill. At this point, most of the “not included provisions” in The White House Build Back Better Framework are not expected to be included in a final BBB bill.


The bipartisan infrastructure bill (Congress passed the Bipartisan Infrastructure Deal (Infrastructure Investment and Jobs Act)) that is expected to be signed by the President this week never had estate tax provisions in it. The following is an overview of the very limited tax provisions of the Infrastructure Investment and Jobs Act:

Automatic Extension of Certain Deadlines for Taxpayers Affected by Disasters

A mandatory (automatic) 60-day deadline extension period applies to qualified taxpayers impacted by federally declared disasters.

Authority to Postpone Certain Tax Deadlines by Reason of Significant Fires

The IRS can suspend filing and payment requirements for taxpayers affected by federally declared disasters or terroristic or military actions.

Employee Retention Tax Credit

Under pre-Act law, eligible employers can claim the employee retention tax credit for wages paid before January 1, 2022 against applicable employment taxes. For each calendar quarter in 2021, the amount of the credit is 70% of the qualified wages (up to $10,000) for each employee.

Eligible employers must: (a) be subject to a governmental order suspending the employer's trade or business (governmental order test), (b) experience a substantial decline in gross receipts, or (c) be a recovery startup business (for wages paid in the third and fourth calendar quarters of 2021).

A "recovery startup business" is any employer that:

1.     began carrying on any trade or business after February 15, 2020,

2.     has average annual gross receipts that do not exceed $1,000,000 for the three-tax-year period ending with the tax year that precedes the calendar quarter for which the employee retention tax credit is determined, and

3.     is not a business subject to a suspension under a government order or had a significant decline in gross receipts for the calendar quarter.

For a recovery startup business, the amount of the employee retention tax credit allowed (after the application of the $10,000 limitation on qualified wages used to compute the credit) can't exceed $50,000 for any calendar quarter.

New Law.  The Act provides that the employee retention tax credit applies to wages paid by an eligible employer after June 30, 2021, and before October 1, 2021 (or in the case of a recovery startup business, wages paid after June 30, 2021, and before January 1, 2022).

Information Reporting for Brokers and Digital Assets

IRC section 6045(a) requires brokers to make a return showing the name and address of each of its customers, with such details regarding gross proceeds and such other information as the IRS may, by forms or regs, require with respect to such business.

With respect to certain covered securities (in general, a specified security acquired on or after the applicable date), the return must include the customer's adjusted basis in the covered security and whether any gain or loss with respect to the covered security is long-term or short-term.

New Law. The Act provides that the definition of broker includes "any person who (for consideration) is responsible for regularly providing any service effectuating transfers of digital assets on behalf of another person.'' The Act provides that a digital asset is a specified security. And, the applicable date for any specified security that is a digital asset is January 1, 2023.

Effective date. The clarification of the definition of broker applies to returns required to be filed, and statements required to be furnished, after December 31, 2023.

Reporting Broker-to-Broker Transfers of Digital Assets

New Law. Any broker, with respect to any transfer (which is not part of a sale or exchange executed by that broker) during a calendar year of a covered security which is a digital asset from an account maintained by the broker to an account which is not maintained by, or an address not associated with, a person that the broker knows or has reason to know is also a broker, is required to make a return for the calendar year, in a form as determined by the IRS, showing the information otherwise required to be furnished.

Effective date. The amendments made by Act Section 80603(b)(2) apply to returns required to be filed, and statements required to be furnished, after December 31, 2023.

Digital Asset Treated as Cash for $10,000 Reporting Purposes

Under IRC section 6050I (a) a person engaged in a trade or business who, in the course of that trade or business, receives more than $10,000 in cash (in one or more related transactions), must file an information return with the IRS and furnish the payor with a statement.

New law. The Act provides that cash, for IRC section 6050I (a) purposes, includes any digital asset.

Effective date. The amendments made by Act Section 80603(b)(3) apply to returns required to be filed, and statements required to be furnished, after December 31, 2023.

To stay up to date on the Infrastructure and Jobs Act, see The White House Briefing Room Fact Sheet.