On May 20, the National Association of Professional Insurance Agents (PIA), along with other small business advocates, sent a letter in strong support of the reconciliation bill presently before the House of Representatives.

On Sunday night, the House Budget Committee voted to advance the legislation, sending it to the Rules Committee for final approval there, before the full chamber gets the opportunity to vote. The Rules Committee met this morning, Wednesday, May 21, at 1 AM EST, to consider the bill, and its work is expected to continue throughout much of the day. Once passed by the Rules Committee, the bill will head to the floor for a full House vote.

Included in the legislation are provisions making permanent the qualified business income (QBI) passthrough tax deduction presently available to eligible S corporations. The bill also would increase the highest available deduction from 20 percent to 23 percent.

Without Congressional action like the permanence provision included in the House reconciliation package, the passthrough tax deduction will expire at the end of 2025. 

Since 2017, millions of small businesses, including many PIA member agencies, have been strengthened by the extra liquidity created by the deduction. Without it, many Main Street businesses would struggle to keep employees and deliver quality service to consumers.

Additionally, the reconciliation bill provides for the reinstatement of an annual administrative and operating (A&O) inflation adjustment for crop agents. For several years, the Risk Management Agency (RMA) provided annual adjustments to crop insurance agent compensation to account for inflation. Then, in 2016, the RMA abruptly stopped providing the inflation adjustment to agents, functionally freezing their compensation in 2016 dollars indefinitely.

PIA strongly supports the reconciliation bill to bring needed relief to independent agency owners and crop insurance agents, and PIA urges the House to pass the bill as soon as possible.