Washington Update: Budget Resolution Clears the Way for Tax Legislation

On April 10, 2025, the House approved the Senate-passed budget resolution, setting the stage for a potentially far-reaching tax and spending package through the reconciliation process.

What to Watch: Tax Policy in Focus

While there is broad agreement between Congress and the White House on extending certain expiring provisions of the Tax Cuts and Jobs Act (TCJA), significant uncertainty remains about what specific tax changes will make it into the final bill.

One of the most debated topics? The $10,000 cap on the state and local tax (SALT) deduction. Set to expire after 2025, the SALT cap has long been a point of contention. Some lawmakers are proposing targeted relief—such as increasing the cap rather than fully eliminating it, or phasing it out for individuals below certain income levels (e.g., under $500,000).

What’s on the Table?

Here’s a look at potential tax provisions currently being discussed as part of the reconciliation package:

🔺 Revenue Raisers

• Eliminating the tax preference for carried interest

• Removing deductions for sports team ownership

• Further limiting the Section 162(m) executive compensation deduction

• Increasing the endowment tax on large private universities

• Placing new limits on the SALT deduction for C corporations

• Scaling back green energy tax incentives

  
  

🔻 Proposed Tax Cuts

• Reinstating 100% bonus depreciation

• Exempting tips, Social Security, and overtime pay from taxation

• Providing targeted tax relief for first responders, military members, and veterans

• Allowing full interest deductions for U.S.-made car loans

• Addressing double taxation for Americans living abroad

• Lowering the corporate tax rate to 15% for domestic manufacturers

• Expanding the Child Tax Credit

  
  

While these proposals are still being shaped, they could significantly affect both individuals and businesses. Whether you're concerned about deductions, depreciation, or corporate tax rates, ECS Financial Services is monitoring the legislative process closely.

We’ll continue to keep you informed as more details emerge—and we're here to help you plan proactively as new policies take shape.