Lawmakers Discuss Year-end Tax Priorities

Several lawmakers have floated ideas for tax priorities for the rest of 2025, but the contentious political climate and lack of any obvious legislative vehicles will make enactment of a second tax package difficult.  

There are only a handful of potential bipartisan tax priorities that would be included on a typical year-end tax extenders package. For example, the work opportunity tax credit is scheduled to expire at the end of 2025. In addition, there is bipartisan interest in legislation that would confer treaty-like tax benefits to Taiwan, extend disaster relief, and make technical corrections to retirement legislation referred to as SECURE 2.0.

The list of tax extenders is small enough that it will be difficult to build momentum for a package. Republicans added several last-minute extenders to the One Big Beautiful Bill Act (OBBBA), including the New Markets Tax Credit and the CFC look-through rule, potentially revealing a lack of confidence in a year-end extenders package. Democrats may be reluctant to pursue an extenders package after being shut out of the reconciliation process that Republicans used to pass the OBBBA. The contentious spending fight will only make any bipartisan action even more difficult. 

Republicans are already discussing a potential second reconciliation bill that could carry other tax priorities without needing Democratic support. Curtis Beaulieu, an advisor to House Speaker Mike Johnson, R-La., recently said there is interest in a “2 Big, 2 Beautiful” follow-up bill that could include priorities left off the first bill, such as retirement tax changes, increasing the Section 199A deduction to 23%, and Section 899.