Don't Mess With Taxes

A recent Ways and Means Committee hearing. (W&M Republicans YouTube channel screen capture)

The Republican-led House Ways and Means Committee had a late Friday surprise for the tax community. It released the tax portion of Donald J. Trump’s mandated "one big, beautiful bill," which also is slated to deal with immigration and energy.

The first thing everyone noticed is that the 61-page document leaves out some of the tax provisions that the GOP has had trouble convincing all of its slim House majority to support.

There’s no mention of at least increasing the state and local taxes (SALT) federal tax deduction cap. Neither is there any discussion of the Biden administration clean energy tax breaks that have created jobs in some Republican representatives districts.

And there isn’t a tax increase for the wealthiest taxpayers, a move which garnered some support from 47 himself.

Tax breaks for 2026 filings: What the bill does include is a tax year 2025 increase of $1,000 in the standard deduction for individual filers ($2,000 for married, jointly filing couples) on top of the already set amounts of $15,000 for individuals and $30,000 for married couples.

It also calls for bumping the maximum Child Tax Credit from $2,000 to $2,500. This popular tax credit also would be effective for the 2025 tax year.

Both of these moves would give taxpayers savings, and in many cases a larger refund, when they file their 2025 tax returns in 2026. And, oh yeah, next year just happens to be an election year.

Of course, the House Ways and Means bill is just a starting point. It’s slated for mark-up on Tuesday, May 13, and changes are likely. The session will start at 2 p.m. ET if you want to set a reminder and check in on what happens to the proposal in real time.

GOP initial take on taxes: To prepare you for the tax bill debate, this weekend’s Saturday Shout Outs go to items covering what’s in and out of the House panel’s first cut at its tax proposal.

Let’s start with the official word.

You can check out the legislative language “Providing for reconciliation pursuant to H.Con.Res. 14, the Concurrent Resolution on the Budget for Fiscal Year 2025” in TITLE XI—COMMITTEE ON WAYS AND MEANS. Yeah, I know. Pretty dense.

I recommend you instead download JCX-18-25, the Joint Committee on Taxation’s PDF describing the items in the bill. It has more plain English explanations of the proposal.

For even clearer discussions, the following news media and tax policy group websites add their takes.

• GOP Tax Bill Seeks to Put Cash in Taxpayers’ Pockets in Early 2026 by Richard Rubin for the Wall Street Journal.
• House Republicans offer peek at their much-anticipated tax plans by Benjamin Guggenheim and Brian Faler for Politico.
• House panel unveils tax portion of Trump agenda bill by Emily Brooks and Tobias Burns for The Hill.
• The Trump tax cut debate is heating up. Here are the key issues and who stands to benefit by Kate Dore for CNBC.

Some tax watchers were already raising questions before the Ways and Means Committee released its proposal. Their observations below, both political and fiscal, are worth a review.

• Ten Questions on House Republicans’ Upcoming Tax Bill by Chuck Marr, Samantha Jacoby, and Kris Cox for the Center on Budget and Policy Priorities.
• Disallowing Business SALT Raises Significant Revenue for Reconciliation but Slows Economic Growth by Garrett Watson for the Tax Foundation.
• Trump wants a 'big beautiful bill' to cut taxes. Will his GOP allies complicate that? by Riley Beggin for USA Today.
• A fight over Medicaid cuts is threatening GOP plans for Trump's 'big, beautiful bill' by Deirdre Walsh and Elena Moore for NPR.

Okay, that’s enough tax reading for even policy wonks, especially on Mother’s Day weekend. 

I’m off to enjoy some outdoor time for the rest of my weekend before temperatures here in the Austin area climb into the 90s next week.

You also might find these items of interest:

• GOP transportation bill calls for federal EV, hybrid fees
• Trump's FY26 budget seeks 23% cut in domestic programs
• House bills seek to ease tax burden of seniors and Social Security recipients

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