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Broadband Grant Tax Treatment Act
3/13/2025, 1:23 AM
Summary of Bill S 674
The bill specifically targets grants that are provided to expand broadband access in underserved and rural areas. By excluding these grants from gross income, the bill aims to incentivize and support the expansion of broadband infrastructure in areas that currently lack access to reliable high-speed internet.
If passed, the Broadband Tax Exclusion Act would provide a tax benefit to organizations and entities that receive grants for broadband expansion projects. This tax exclusion would help reduce the financial burden on these entities and encourage them to invest in expanding broadband access to underserved communities. Overall, the bill seeks to promote the expansion of broadband infrastructure in areas that need it most by providing a tax incentive for organizations to invest in these projects. It is a non-partisan effort to improve access to high-speed internet and bridge the digital divide in the United States.
Congressional Summary of S 674
Broadband Grant Tax Treatment Act
This bill excludes from gross income (for federal tax purposes) certain grants received for broadband deployment.
As background, contributions of capital to a corporation generally are not taxable income. However, under an exception enacted in 2017 by the Tax Cuts and Jobs Act, grants from a government or civic organization are not contributions to capital and, thus, treated as taxable income. Prior to the Tax Cuts and Jobs Act, the Internal Revenue Service (IRS) considered certain grants from a government or civic organization contributions of capital and, thus, not taxable income.
The bill specifically excludes from gross income grants received for broadband deployment from the
- National Telecommunications and Information Administration (NTIA) Broadband Equity, Access, and Deployment Program;
- NTIA State Digital Equity Capacity Grant Program;
- NTIA Digital Equity Competitive Grant Program;
- NTIA Enabling Middle Mile Broadband Infrastructure Program;
- Department of Agriculture ReConnect Program;
- Coronavirus State and Local Fiscal Recovery Funds and the Coronavirus Capital Projects Fund; and
- NTIA Tribal Broadband Connectivity Program and the Broadband Infrastructure Program.
The bill also requires the IRS to issue guidance on the exclusion from gross income of such grants.
The bill applies to funds received in tax years ending after March 11, 2021.
Read the Full Bill
Current Status of Bill S 674
Bipartisan Support of Bill S 674
Total Number of Sponsors
1Democrat Sponsors
0Republican Sponsors
1Unaffiliated Sponsors
0Total Number of Cosponsors
11Democrat Cosponsors
4Republican Cosponsors
6Unaffiliated Cosponsors
1Policy Area and Potential Impact of Bill S 674
Primary Policy Focus
Alternate Title(s) of Bill S 674
Comments
Aileen Parks
11 months ago
I am so excited about this new bill! It will help expand broadband access in rural areas like mine, which will make it easier for me to stay connected with my family and friends. This bill will also provide tax incentives for companies to invest in broadband infrastructure, which will create jobs and boost the economy. I can't wait to see the positive impact this bill will have on my community and the country as a whole.
