House Passes Tax Reform Bill Extending Key Provisions for Insurance Agencies

The U.S. House of Representatives passed a comprehensive tax reform bill that permanently extends significant provisions of the 2017 Tax Cuts and Jobs Act (TCJA), including the Section 199A deduction for qualified business income. This deduction benefits pass-through entities such as independent insurance agencies, which comprise 86% of the sector, by increasing the deduction rate from 20% to 23%. The legislation also makes individual tax rates permanent with revised inflation adjustments but does not alter corporate tax rates. The bill aims to support business structures prevalent in the insurance agency market and now proceeds to Senate consideration.