The House and Senate Dec. 20 passed H.R. 1, the Tax Cuts and Jobs Act, legislation that will make major and substantial changes to the tax code. Following a successful vote in the House and Senate, the House voted on the bill a second time as three provisions were found to be in violation of Senate parliamentary rules. The vote followed a conference committee meeting where members from both the House and Senate met to iron out the differences between each chamber’s bill [see Washington Highlights, Dec. 7].
Prior to the vote, AAMC president and CEO Darrell G. Kirch, MD, reacted to the legislation reported out of the conference committee, saying “The AAMC appreciates that members of the conference committee heard our concerns and chose to remove certain provisions from the conference committee tax legislation that would have negatively impacted our member medical schools and teaching hospitals, the patients they care for, the students and residents they teach and train, and the millions of Americans who gain hope from the research they conduct. We remain disappointed, however, that the legislation repeals the individual mandate.”
The legislation maintains the tax exemption of private activity bonds (PABs) and does not repeal several higher education tax incentives that would have had a deleterious impact on graduate students and those in the research career pipeline. The bill does, however, repeal the individual mandate set forth by the Affordable Care Act (ACA) and makes changes to advance refunding bonds, an important source of financing for teaching hospitals and academic medical centers. The bill also imposes a 1.4 percent tax on the net investment income of certain private colleges and universities.
President Trump celebrated the bill with Republican leaders at the White House. He signed the bill into law Dec. 22.