Update on the Inflation Reduction Act of 2022 & the FY2022 Budget Reconciliation Bill

We are monitoring developments regarding a vote that will take place in the Senate next week. The vote relates to the Inflation Reduction Act of 2022 and the FY2022 Budget Reconciliation Bill.

Much attention is being given to this vote, not only due to the changes it could bring about for many taxpayers, but also because Senator Joe Manchin (D-W.Va) has announced his now supports the legislation after recently taking a strong stance against it. His previous sticking point was wanting the legislation to outline lowering prescription drug prices and healthcare costs.

However now, to the surprise of many, Sen. Manchin has released a joint statement with Senate Majority Leader Chuck Schumer (D-NY) stating they have reached an agreement on the expansive legislation that touches upon energy and climate issues, healthcare care costs and more. This legislation aims to tax those in higher income brackets.

The joint statement reads:

“Today, we are pleased to announce an agreement to add the Inflation Reduction Act of 2022 to the FY2022 Budget Reconciliation bill. After many months of negotiations, we have finalized legislative text that will invest approximately $300 billion in Deficit Reduction and $369.75 billion in Energy Security and Climate Change programs over the next ten years. The investments will be fully paid for by closing tax loopholes on wealthy individuals and corporations. In addition, the expanded Affordable Care Act program will be extended for three years, through 2025. The revised legislative text will be submitted to the Parliamentarian for review this evening and the full Senate will consider it next week.

“The Inflation Reduction Act of 2022 will make a historic down payment on deficit reduction to fight inflation, invest in domestic energy production and manufacturing, and reduce carbon emissions by roughly 40 percent by 2030. The bill will finally allow Medicare to negotiate for prescription drugs and lower health care costs for millions of Americans. Additionally, we have reached agreement with President Biden and Speaker Pelosi to pass comprehensive permitting reform legislation before the end of this fiscal year. We urge every member of the U.S. Senate to support this important legislation.”

The Republican Party is meeting this announcement with opposition and criticism. This situation remains fluid. We will continue to monitor this and post further updates as needed. Please reach out to us with any questions or concerns you may have.