U.S. Sen. Jim Inhofe (R-Okla.) praised the release of the conference agreement on H.R. 1, the Tax Cuts and Jobs Act today, which included key Inhofe amendments that would ensure the tax cut bill treats all Oklahoma companies fairly, protecting jobs and economic growth in Oklahoma:
“I am pleased the conference committee demonstrated Congress’ commitment to making the tax code fair and simple by including my amendment to ensure family-owned businesses of all types are treated the same under the tax code. Many of our manufacturers, retailers, farmers, and community bankers have structured their businesses to maximize their ability to grow and create jobs, but the original Senate bill penalized some because of their specific ownership structure. My amendment addressed that, so now family-owned businesses will not be at a competitive disadvantage. The conference report also included other provisions I fought for to support businesses who make capital investments by expanding interest deductibility and protecting the tax-exempt status for valuable community-serving organizations. ”
Background on the Amendments
Inhofe 1736 - Including trust businesses for pass through deduction. The Senate-passed version of H.R. 1 provided a 23 percent deduction for businesses structured as pass through entities, but it excluded those entities that are organized as trusts. This would have a negative impact on family owned businesses in Oklahoma. Inhofe authored Amendment #1736 to address this issue. The conference report to H.R. 1 incorporated this amendment into the final package; all businesses organized as pass through entities will be treated the same.
Inhofe 1602 – Increasing the amount of interest that can be deducted by businesses. Both the House and Senate passed versions of H.R. 1 limited the amount of interest that can be deducted by businesses. The House limited the amount to 30 percent of a businesses’ annual earnings before interest, taxes, depreciation and amortization. The Senate limited to 30 percent of a businesses’ annual earnings before only interest and taxes, a significantly lower number. The Senate language would have resulted in a less favorable tax position for many Oklahoma companies. Inhofe authored Amendment #1602 to address this so that the Senate bill would mirror the House. The conference report to H.R. 1 incorporated this amendment into the final package for the first four years of the bill.
Local businesses praised Inhofe’s advocacy and leadership on tax reform:
“I commend Senator Inhofe for his leadership to ensure that family-owned businesses will benefit from comprehensive tax reform. Because Senator Inhofe’s tireless advocacy, our company will continue to be able to invest in the economy and grow jobs in communities across the United States,” said Frank Love, Co-CEO of Love’s Travel Stops and Country Stores. “American family owned businesses are key drivers of robust and sustained economic opportunity in communities throughout the United States and should be treated equally under the new tax code.”
“I appreciate efforts by Senator Inhofe to ensure that family-owned businesses will see a positive impact from comprehensive tax reform,” said Jeff Records, MidFirst Bank’s Chief Executive Officer. “Community banks, like MidFirst Bank, serve as anchors in our communities, providing economic opportunity for families and small to mid-size businesses across Oklahoma and the other markets we serve. Thanks to Senator Inhofe’s tireless advocacy, our family-owned company will continue to be able to maximize our support of community investment and in turn grow the nation’s economy.”
“We greatly appreciate Senator Inhofe’s work to ensure that tax reform will encourage more economic growth and investment that will benefit the citizens of Oklahoma,” said Alan S. Armstrong, CEO of Williams Companies. “The Williams Company strongly supports this legislation and urges its rapid enactment into law.”
“The nation’s nearly 2,000 Subchapter S community banks greatly appreciate Sen. James Inhofe’s successful efforts to improve the tax reform bill to correct a damaging provision on trusts that would have harmed locally focused financial institutions,” said Camden R. Fine, President and CEO of the Independent Community Bankers of America. “ICBA and the nation’s community bankers thank Sen. Inhofe for his bold leadership in ensuring that these institutions can continue using their business model to best serve families and small businesses in their communities for generations to come.”
“Many construction firms utilize trust ownership for a variety of reasons, such as estate and succession planning, and asset protection,” said Stephen E. Sandherr, chief executive officer of the Associated General Contractors of America. “Excluding trusts from receiving the pass-through deduction would have resulted in increased shareholder taxes at many construction firms, interrupted ownership arrangements, or forced changes in business entities. AGC appreciates Senator Inhofe’s leadership on ensuring that pass-through businesses with trust owners fully benefit from tax reform under the Tax Cuts and Jobs Act.”
“NRCA commends Sen. James Inhofe for his strong leadership in ensuring that tax reform treats family-owned roofing industry entrepreneurs fairly,” said Jim Barr of Barr Roofing, Abilene, TX, Chairman of the Board, National Roofing Contractors Association. “We greatly appreciate his efforts on this critical issue.”
"Senator Jim Inhofe and his staff have tirelessly worked on a number of issues to ensure that American consumers have access to plentiful affordable energy,” said Mike Mears, CEO of Magellan Midstream. “Most recently the Senator played a key role in preserving a competitive structure for Master Limited Partnerships during tax reform deliberations. Magellan and many of America's other pipeline companies are structured as a Master Limited Partnership. This structure provides the public an opportunity to invest in capital intensive energy infrastructure projects. We are grateful for the Senator's leadership on tax reform and other issues important to Oklahoma and the entire country which create jobs and grow the economy."
“MLPA thanks Senator Jim Inhofe for his unwavering commitment to MLPs and our nation’s domestic energy infrastructure industry,” said Lori E. L. Ziebart, Executive Director of the Master Limited Partnership Association. “Through his determined leadership on the Tax Cuts and Jobs Act, MLPs will continue to be able to attract capital from the public markets to build our nation’s critical energy infrastructure and in turn lowering the cost of energy for America’s consumers.”
“I appreciate Sen. Inhofe’s efforts during the consideration of the Tax Cuts and Jobs Act to ensure the Oklahoma Farm Bureau is continued to be treated as a tax-exempt organization,” said Rodd Moesel, President of the Oklahoma Farm Bureau. “Each year, the Farm Bureau serves Oklahoma’s farmers and ranchers by providing important services to improve the lives of rural Oklahomans. Our mission would have been directly jeopardized if any changes to our tax status had been contemplated in this important legislation. Because of his leadership, agriculture will continue to be a vital component of our state’s economy."